Full text of "Land and Water Conservation Fund Act amendments : hearing before the Subcommittee on Public Lands, National Parks, and Forests of the Committee on Energy and Natural Resources, United States Senate, One hundredth Congress, first session on S. 735 ... July 14, 1987"

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S. Hrg. 100-253

LAND AND WATER CONSERVATION
FUND ACT AMENDMENTS

HEARING

BEFORE THE

SUBCOMMITTEE ON
PUBLIC LANDS, NATIONAL PAEKS AND FORESTS

OF THE

COMMITTEE ON

ENERGY AND NATURAL RESOURCES

UNITED STATES SENATE

ONE HUNDREDTH CONGRESS
FIRST SESSION

S. 735

TO AMEND THE LAND AND WATER CONSERVATION FUND ACT OF 1965,

AND FOR OTHER PURPOSES

JULY 14, 1987

DOCS

77-689

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S. Hrg. 100-253

LAND AND WATER CONSERVATION
FUND ACT AMENDMENTS

HEARING

BEFORE THE

SUBCOMMITTEE ON
PUBLIC LANDS, NATIONAL PAEKS AND FORESTS

OF THE

COMMITTEE ON

ENERGY AND NATUEAL RESOUECES

UNITED STATES SENATE

ONE HUNDREDTH CONGRESS

FIRST SESSION

S. 735

TO AMEND THE LAND AND WATER CONSERVATION FUND ACT OF 1965,

AND FOR OTHER PURPOSES

JULY 14, 1987

Printed for the use of the
Committee on Energy and Natural Resources

U.S. GOVERNMENT PRINTING OFFICE
77-689 WASHINGTON : 1987 ff ^r^-'J ^^^'

For sale by the Superintendent of Documents, Congressional Sales OfTice
^^^ U.S. Government Printing OfTice, Washington, DC 20402

ircT wor . 4 Y Du^OSiumY

iry I

Boston ^yblic Library
Boston, MA 02116

COMMITTEE ON ENERGY AND NATURAL RESOURCES

J. BENNETT JOHNSTON, Louisiana, Chairman

DALE BUMPERS, Arkansas JAMES A. McCLURE, Idaho

WENDELL H. FORD, Kentucky MARK O. HATFIELD, Oregon

HOWARD M. METZENBAUM, Ohio LOWELL P. WEICKER, Jr., Connecticut

JOHN MELCHER, Montana PETE V. DOMENICI, New Mexico

BILL BRADLEY, New Jersey MALCOLM WALLOP, Wyoming

JEFF BINGAMAN, New Mexico FRANK H. MURKOWSKI, Alaska

TIMOTHY E. WIRTH, Colorado DON NICKLES, Oklahoma

WYCHE FOWLER, Jr., Georgia CHIC HECHT, Nevada

KENT CONRAD, North Dakota DANIEL J. EVANS, Washington

Daryl H. Owen, Staff Director

D. Michael Harvey, Chief Counsel

Frank M. Cushing, Staff Director for the Minority

Gary G. Ellsworth, Chief Counsel for the Minority

Subcommittee on Pubuc Lands, National Parks and Forests

DALE BUMPERS, Arkansas, Chairman
JEFF BINGAMAN, New Mexico, Vice Chairman

JOHN MELCHER, Montana MALCOLM WALLOP, Wyoming

BILL BRADLEY, New Jersey LOWELL P. WEICKER, Jr., Connecticut

TIMOTHY E. WIRTH, Colorado MARK O. HATFIELD, Oregon

WYCHE FOWLER, Jr. Georgia PETE V. DOMENICI, New Mexico

KENT CONRAD, North Dakota FRANK H. MURKOWSKI, Alaska

CHIC HECHT, Nevada
J. Bennett Johnston and James A. McClure are Ex Officio Members of the Subcommittee

Thomas B. Williams, Senior Professional Staff Member
Beth Norcross, Professional Staff Member

(n)

^H"nv.

ii>(j > lou ,^

CONTENTS

Page
S. 735 11

STATEMENTS

Berryman, Jack H., executive vice president. International Association of

Fish and Wildlife Agencies 105

Bingaman, Hon. Jeff, a U.S. Senator from the State of New Mexico 7

Bumpers, Hon. Dale, a U.S. Senator from the State of Arkansas 4

Dunlop, George S., Assistant Secretary, Department of Agriculture 29

Horn, William P., Assistant Secretary for Fish and Wildlife and Parks, De-
partment of the Interior 15

Jarvis, T. Destry, vice president, conservation policy, National Parks and

Conservation Association 87

Johnston, Hon. J. Bennett, a U.S. Senator from the State of Louisiana 1

Katz, John W., director of State/Federal relations and special counsel to Gov.
Steve Cowper, State of Alaska; accompanied by G. Thomas Koester, assist-
ant attorney general. State of Alaska 51

Koester, G. Thomas, assistant attorney general. State of Alaska 57

Mahoney, Tim, Washington representative, Sierra Club and chairman, Alaska

Coalition 94

Murkowski, Hon. Frank H., a U.S. Senator from the State of Alaska 27

Stevens, Hon. Ted, a U.S. Senator from the State of Alaska 8

Tindall, Barry S., director of public affairs. National Recreation and Park

Association 74

Wallop, Hon. Malcolm, a U.S. Senator from the State of Wyoming 48

Williamson, Lonnie L., vice president. Wildlife Management Institute 100

APPENDIX
Additional material submitted for the record 113

(m)

LAND AND WATER CONSERVATION FUND ACT

AMENDMENTS

TUESDAY, JULY 14, 1987

U.S. Senate,
Subcommittee on Public Lands,

National Parks and Forests,
Committee on Energy and Natural Resources,

Washington, DC.

The subcommittee met, pursuant to notice, at 2:15 p.m. in room
SD-366, Dirksen Senate Office Building, Hon. J. Bennett Johnston,
chairman, presiding.

OPENING STATEMENT OF HON. J. BENNETT JOHNSTON, A U.S.
SENATOR FROM THE STATE OF LOUISIANA

The Chairman. The hearing will come to order. The purpose of
the hearing this afternoon is to receive testimony on S. 735, a bill
which I introduced on March 12 to amend the Land and Water
Conservation Fund Act of 1965.

S. 735 would create a special account within the Land and Water
Conservation Fund. This account would have two funding sources:
a portion, that is 25 percent, of the revenues due the United States
from future oil and gas leasing activities in units of the National
Wildlife Refuge System; and $160 million annually to be drawn
from the authorized but unappropriated balance of the Land and
Water Conservation Fund. This balance currently totals some $5.34
billion.

Monies credited into this special account from these two sources
are to be made available for high priority federal land acquisition
projects. These projects are to be identified by the appropriate land
managing agencies on an annual basis through the submission of
priority lists to the House and Senate Appropriations Committees.

These Committees would then allocate the funds from the special
account to the agencies in accordance with the list and the amount
of money available. Should the Appropriations Committees fail to
allocate these funds, the Secretary of the Treasury would then be
authorized and directed to make these monies available directly to
the land managing agencies for land acquisition projects on the list
in accordance with the formula provided in the bill.

This funding mechanism in effect is an automatic appropriation,
so that if the Congress did not act to appropriate then the agencies
would get $160 million, which is the average amount given to these
agencies over the last seven years, plus these funds from the wild-
life refuges, and they would be automatically — not automatically

(1)

spent, but automatically made available and spent on these priori-
ty lists.

And of course, the Congress could change the priority list.
Indeed, they could repeal it altogether each year. But failing Com-
mittee action, they would be spent on the priority list.

With regard to the remainder of the revenues generated from
future leasing on wildlife refuges, I should note that 50 percent
would be made available to the state in which the refuge is located
and 25 percent into the Treasury.

Having stated briefly what this bill does do, let me state what
the bill does not do.

S. 735 does not open the Arctic National Wildlife Refuge to oil
and gas leasing. I should say that over and over again, maybe two
or three times. Nor does it indicate any preference, any inclination,
any intention, any tilt, any direction, any prejudice in favor of that
oil and gas leasing.

It does not open any unit of the wildlife refuge system to oil and
gas leasing. In fact, this bill does not make any judgment whatso-
ever of any kind or nature respecting these leasing activities.

In addition, S. 735 does not affect the current disposition of reve-
nues pursuant to existing oil and gas leasing in refuges. It does not
reach back and impact the revenue sharing arrangements within
the federal government, the states, or units of local governments
which are funded pursuant to existing oil and gas activities in ref-
uges.

Finally, S. 735 is not designed to be a comprehensive reform of
the Land and Water Conservation Fund. I am aware that other
proposals, including the recommendations of the President's Com-
mission on the Great Outdoors, which Commission I have the
honor to serve on, has suggested that major and fundamental
changes be made in the fund, and I think we ought to look at those
on another day.

Many of these proposals have merit and I am sure that Congress
will address them. The bill before us today, however, is designed to
deal with a much more specific issue, attempting to reduce the
backlog of authorized but unacquired lands inside federal parks,
refuges, and forests.

I believe that the approach embodied in S. 735 makes sense, that
it is feasible and workable, and that it will enhance the nation's
recreation and wildlife estate. I am prepared to work with those
who want to improve the bill and look forward to the Committee's
expeditious consideration.

At this point, I will place a copy of the bill in the hearing record
and am pleased to welcome Assistant Secretary Horn of the De-
partment of Interior and Assistant Secretary Dunlop of the Depart-
ment of Agriculture as our first witnesses today.

And let me say, later we are going to have people from the envi-
ronmental community. I want to repeat again, this does not in any
way prejudice what we will do on ANWR. But just in case this Con-
gress or some other Congress does make that decision in whole or
in part, it would certainly be a nice thing to have a source of reve-
nues to deal with what is a great unmet need and has been a great
unmet need since I have been in the Congress for 15 years.

So, Secretary Horn, we are pleased to welcome you and Secretary
Dunlop to the Committee, and please proceed. Both of your state-
ments will be put into the record as if read in full. You may sum-
marize or do whatever you like.

[The prepared statements of Senator Bumpers, Senator Binga-
man, Senator Stevens and the text of S. 735 follow:]

STATEMENT BY THE HONORABLE DALE BUMPERS

The purpose of the h'earing this afternoon is to consider S.
735 - a bill to amend the Land and Water Conservation Fund Act of
1965. This measure, introduced by Senator Johnston, would seek
to make additional funds available to acquire lands authorized by
Congress for inclusion in the National Park, Refuge, Wilderness
and Forest Systems.

Primary funding would be derived from a portion of future
revenues due the United States from oil and gas leasing inside
units of the National Wildlife Refuge System. The bill provides
that 50 percent of such revenues go to the state in which the
refuge is located; 25 percent to the federal Treasury; and 25
percent to the Land and Water Conservation Fund.

Additional funds, $160 million per year, would also be
available to be derived from the authorized but unappropriated
balance of the Land and Water Conservation Fund - a balance which
currently totals some $5.3 billion.

Together, these monies would be deposited into a special
account to be used to reduce the backlog of authorized but
unfunded land acquisition projects.

I am aware of some of the concerns that have been raised
regarding this measure by several conservation organizations, the

- 2 -

State of Alaska, and others. However, I am hopeful that those
concerns can be addressed and that the Committee will consider
this proposal carefully.

statement of Senator Jeff Bingaman
Land and Water Conservation Fund

July ^^, 1987

I thank the Chairman for scheduling this hearing to
consider his legislation to provide a dedicated fund for
federal land acquisition that would be supported in part by
revenues form oil and gas development in national wildlife
refuges. I appreciate the strong leadership he has provided
in support of the Land and Water Conservation Fund over the
years. This is an issue for which I have an abiding
interest.

Background of LWCF

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provide a source of funds for
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provided to state and local
ly, the Land and Water
r protection of lands and water
, including acquisition of new
y established parks, forests,
s .

One of the major philosophies behind this Fund was that
as the nation depleted its finite oil and gas reserves, a
portion of the income from that extraction should be
reinvested for public benefit by purchasing and preserving
other natural and cultural resources.

The Land and Water Conservation Fund has proven
extremely successful and represents the best in public
policy. It has resulted in the preservation of many areas of
natural and historic significance. Almost three million
acres of federal land have been acquired with $3 billion
since the origin of the Fund. In addition, almost $3 billion
has been appropriated and matched by the states for planning,
development and acquisition designed to improve the quantity
and quality of outdoor recreation in this country. New
Mexico has benefited significantly over the years from the

statement of Senator Jeff Bingaman
Land and Water Conservation Fund
July 14, 1987
Page 2

fund through the acquisition of new park units, wildlife
refuges and outdoor recreation areas.

Johnston Legislation

The Legislation we consider today would create a
mechanism for providing a dedicated source of revenues for
the fund. Under S. 735, 25 percent of all leasing fees,
bonuses and royalties from oil and gas wells in wildlife
refuges would be deposited in a new account to be established
within the Land and Water Conservation Fund. In addition,
the new account would receive $160 million annually from the
authorized by unappropriated balances of the Fund, now
estimated at about $5 billion. All of the money deposited in
the special account would then automatically become available
to the four main federal land managing agencies.

Some may argue that this approach is not the best method
for financing the fund. However, I appreciate Senator
Johnston's effort to explore alternatives and I look forward
to working with him on this issue. I was also pleased that
the President's bi-partisan Commission on Americans Outdoors
recognized the importance of the Fund by recommending the
establishment of a trust fund with a permanent appropriation
of $1 billion.

I am interested in pursuing all alternatives that can
provide a stable and permanent source of funding for the
important purpose of federal land acquisition.

I look forward to hearing the testimony presented today.

TESTIMONY OF SENATOR TED STEVENS

ON S. 735

BEFORE THE SUBCOMMITTEE ON PUBLIC LANDS,

SENATE COMMITTEE ON ENERGY AND NATURAL RESOURCES

ly 14, 1987 y^

ry^ ^UO--^^^-^-

Mr. Chairman, as the senior Senator from Alaska and as
one intimately involved in Alaska's battle to achieve
Statehood in the 1950's, I must oppose S. 735.

The Alaska Statehood Act is a compact between the people
of Alaska and the federal government. Alaska accepted
conditions set forth by Congress in exchange for benefits
conferred by the Act. The reallocation of public land
revenues proposed in S. 735 would deny Alaska one of those
benefits.

Before Alaska became a State, the federal government
agreed to dedicate 90 percent of the revenues from oil and
gas leasing on federal lands to Alaska. The Mineral Leasing
Act of 1920 entitles other states to 50 percent of of those
revenues in direct payments. Of the remainder, 40 percent
is placed in the Reclamation Fund, which is dedicated to
projects in the 17 western public land States.

Alaska does not have access to the Reclamation Fund.
This fact was a major reason for providing Alaska with
direct payment of the entire 90 percent revenue share. Also
important was Congress' recognition that an overwhelming
percentage of Alaska was, and would continue to be,
federally owned and that federal lands would not contribute

much to the economic development of Alaska. This insight
was validated by the passage of the Alaska National Interest
Lands Conservation Act in 1980, which closed more than a
third of Alaska to most forms of development.

The 90 percent formula for Alaska has been waived only
once. When the National Petroleum Reserve - Alaska (NPRA)
was opened to leasing, Alaska agreed to accept only a 50
percent share of federal oil and gas revenues. NPRA,
however, was reserved from oil and gas leasing by the
federal government for its energy potential prior to
Statehood. This fact justified a different treatment of
revenues derived from the Reserve.

The main target of the bill before the subcommittee is
the Arctic National Wildlife Refuge (ANWR) , formerly the
Arctic National Wildlife Range. Unlike NPRA, the Range was
open to oil and gas leasing. Also, the Range was created a
year after Alaska became a State. Therefore, the rationale
used to justify the reduction of Alaska's share of federal
revenues from NPRA cannot be applied to ANWR.

We Alaskans have zealously defended our rights under the
Statehood Act since 1959. We have waived those rights only
on rare occasions, such as the passage of the Alaska Native
Claims Settlement Act in 1971. After consultation with
Alaska's legislature, Alaska's governor joined our
Congressional Delegation in agreeing to voluntarily return
lands, the selection of which had received tentative
approval from the Department of the Interior, in order that
those lands could be conveyed by Congress to Alaska's Native
people.

S. 735's basic goal -- acquisition of important
recreational, scenic, and habitat lands by the federal
government -- is sound. It would achieve its goal, however,
by denying Alaska one of the fundamental benefits conferred
by the Statehood Act without offering the State appropriate
compensation. There must be a fairer approach, and I hope
that we will be able to work with the distinguished Chairman
of the Energy and Natural Resources Committee, who is the
sponsor of S. 735 and a good friend of Alaska, to identify
that approach.

Thank you, Mr. Chairman.

100th congress

IST Session

S. 735

To amend the Land and Water Conservation Fund Act of 1965, and for other

purposes.

IN THE SENATE OF THE UNITED STATES

March 12, 1987

Mr. Johnston introduced the following bill; which was read twice and referred
to the Conunittee on Energy and Natural Resources

A BILL

To amend the Land and Water Conservation Fund Act of 1965,

and for other purposes.

1 Be it enacted by the Senate and House of Representa-

2 tives of the United States of America in Congress assembled,

3 That the Land and Water Conservation Fund Act of 1965,

4 as amended, is further amended by adding the following new

5 title:

6 "TITLE m— SPECIAL ACCOUNT

7 "Sec. 301. (a) Notwithstanding any other provision of

8 law, all revenues received from competitive bids, sales, bo-

9 nuses, royalties, rents, fees, interest charges or other income
10 derived from the leasing of oil and gas resources within units

1 of the National Wildlife Refuge System pursuant to leases

2 issued after the date of enactment of this title shall be distrib-

3 uted as follows:

4 "(1) 50 per centum to the State in which the

5 refuge unit is located;

6 "(2) 25 per centum deposited into the fund; and

7 "(3) 25 per centum to miscellaneous receipts in

8 the Treasury.

9 "(b)(1) Moneys deposited into the fund pursuant to sub-

10 section (a) shall be credited to a special account within the

11 fund. In addition, there shall also be deposited into this spe-

12 cial account, $160,000,000 per annum to be derived from

13 those moneys comprising the authorized but unappropriated

14 balance of the fund.

15 "(2) Funds deposited into the special account shall be

16 available, without further appropriation, for Federal purposes

17 as provided in section 7 of this Act and shall be allocated in

18 accordance with this title.

19 "Sec. 302. (a) At the time of the submission of the

20 President's budget, each Federal land managing agency eligi-

21 ble to receive moneys from the fund shall provide the Com-

22 mittee on Appropriations of the United States House of Rep-

23 resentatives and the United States Senate with a list, in de-

24 scending order of priority, of land acquisition projects (herein-

25 after in this title referred to as the 'priority Ust').

S 735 IS

1 "(b) The priority lists shall be prepared by the Directors

2 of the Bureau of Land Management, National Park Service,

3 Fish and Wildlife Service, Department of the Interior, and

4 the Chief of the Forest Service, United States Department of

5 Agriculture, and shall reflect their best professional judgment

6 regarding the land acquisition priorities of such bureau or

7 agency.

8 "(c) In preparing such lists the following factors shall be

9 considered: the amount of money anticipated to be made

10 available in any one year; the availability of land appraisal

11 and other information necessary to complete the acquisition

12 in a timely manner; the potential adverse impacts on the

13 park, wilderness, wildlife refuge or other such unit which

14 might result if the acquisition is not undertaken; and such

15 other factors as the land managers deem appropriate.

16 "Sec. 303. (a) The Secretary of the Treasury shall

17 notify the Appropriations Committees of the Congress on an

18 annual basis as to the amounts available for allocation within

19 the special account estabUshed pursuant to this title.

20 "(b) The Appropriations Committees shall allocate the

21 funds from the special account in accordance with the priority

22 Usts submitted pursuant to section 302(a) unless such lists are

23 specifically modified in appropriation Acts or reports accom-

24 panying such Acts.

S 735 IS

1 "(c) In allocating funds from the special account among

2 land managing agencies the Appropriations Committees shall

3 ensure that each agency receives a fair and equitable share in

4 accordance with land acquisition needs, congressional direc-

5 tives, and historical patterns of distribution of the fund: Pro-

6 vided, That no agency shall receive more than 50 per centum

7 of the funds available from the special account in any one

8 year.

9 "(d) In the event that the Appropriations Committees

10 fail to allocate the funds from the special account, the Secre-

1 1 tary of the Treasury is authorized and directed to make such

12 funds directly available to the land managing agencies to be

13 used solely for land acquisition projects on the respective pri-

14 ority lists in accordance with the following formula:

15 "40 per centum to the National Park Service;

16 "40 per centum to the Fish and Wildlife Service;

17 "15 per centum to the Forest Service; and

18 "5 per centum to the Bureau of Land Manage-

19 ment.".

S 735 IS

STATEMENT OF WILLIAM P. HORN, ASSISTANT SECRETARY FOR
FISH AND WILDLIFE AND PARKS, DEPARTMENT OF THE INTE-
RIOR

Mr. Horn. Mr. Chairman, thank you very much. Let me summa-
rize my statement.

Obviously, I am pleased to testify today and appear before you on
this subject. I think that these topics are most important, particu-
larly the future of the Land and Water Conservation Fund and in
particular your bill, S. 735.

I think it is worth noting that the Land and Water Conservation
Fund Act of 1965 was initially based on the notion that outdoor
recreation activities be financed largely on a pay-as-you-go basis
from fees collected from the direct beneficiaries, the users of the
Federal lands and waters.

In 1968, the user sources of funding were expanded to include re-
ceipts from the Outer Continental Shelf leasing program, with an
authorization ceiling that was initially established at $200 million
and later expanded in 1979 to $900 million annually.

In recent years the budgetary situation has resulted in limited
requests from the Administration for appropriations from the fund,
and action by the Congress providing annual appropriations far
below the $900 million authorization.

I think it is important to note in discussing this issue and others
related to LWCF that it is not a genuine fund and there is no un-
appropriated group of dollars sitting somewhere in an account
available for disposition. We think the best analogy is a Mastercard
or a Visa card, in that we have a credit line of up to $900 million,
and if Congress chooses to expend those dollars it of course has to
do so with an appropriation.

This does not come from any type of specified fund where bal-
ances sit and are available in the future if not expended.

[The prepared statement of Mr. Horn follows:]

TESTIMONY OF WILLLAM P. HORN, ASSISTANT SECRETARY FDR FISH AND WILDLIFE AND
PARKS, DEPARTMENT OF IHE INTERIOR, BEFORE THE SUBCOMMITTEE Oti PUBLIC LANDS,
NATIONAL PARKS AND FORESTS OF TOE SENATE COMMITTEE ON ENERGY AND NATURAL
RESOURCES, CaCERNIM; S. 735, AMENDING THE LAND AND WATER CONSERVATION FUm

Mr. Chairman, I am William P. Horn, Assistant Secretary for Fish and

Wildlife and Parks of the Department of the Interior. I am pleased to be

able to testify today on a subject which is quite important to me — the

future of the Land and Water Conservation Fund, and in particular Chairman

Johnston's bill, S. 735, to provide a constant level and source of funds

for Federal land acquisition.

The Land and Water Conservation Fund Act of 1965 was enacted to provide
Federal assistance and funds to the States for the planning, acquisition
and development of land and water areas, and to provide funds for federal
acquisition of lands. The fund initially was based on the notion that
outdoor recreation opportunities be financed largely on a "pay as you go"
basis from fees collected from the direct beneficiaries — the users of
Federal recreational lands and waters. Originally, the fund consisted of
revenues derived from several sources: entrance fees collected at Federal
recreational areas, receipts from the sale of surplus property, and the
motorboat fuel tax. In 1968, these sources were expanded to include
receipts derived from the Outer Continental Shelf Lands Act, with the
authorization ceiling initially established at $200 million and later
(1979) expanded to $900 million annually. Unappropriated authority is
carried forward for possible future appropriation. Authorization for the
annual $900 million allocation under the Fund expires at the end of fiscal
year 1989.

In recent years, the budgetary situation has resulted in limited requests

fron the Administration for appropriations from the Fund, and action by the
Congress providing annual appropriations far below the $900 million
authorization, resulting in a cumulative balance in the authorization of
approximately $5.1 billion. May I point out, Mr. Chairman, that this amount
is not sitting in an account somewhere, but is currently available in the
general Treasury for other uses. S. 735, by providing a constant level of
funding, is intended to improve these land acquisition programs by having
them again operate from a resource-based priority systan, which would in
turn permit planning on a multi-year basis.

As you know, I have gone to some lengths in attempting to provide a land
acquisition program for the National Park Service and the Fish and Wildlife
Service within the current efforts to reduce Federal spending. Einphasis has
been placed on land protection by cooperative agreement, acquisition of
partial interests, and when necessary, fee title acquisition has been
sought through donation, partial donation, or exchange.

However, the Department's position on S. 735 has not changed since Chairman
Johnston's discussion with Secretary Hodel during the June 2 hearing on our"
1002 Report. The Secretary and I continue to find the el«nents of the
legislation to contain seme interesting concepts but due to the complexity
of the entire LWCF issue, the Administration has not completed its review
of the Fund program and the various options for its continuation.
Therefore, while I will discuss some of the acconplislnments of the Fund and
the general options currently under review, I cannot at this time reccmmend
approval or disapproval of S. 735 or offer any specific suggestions or
alternatives.

VJhile we are fully aware of tliis and other proposals for use of some
portion of the Federal revenues from any oil leasing at the ^ctic National
Wildlife Refuge for Land and Water Conservation Fund or other conservation
purposes, we believe it is premature to focus on the issue at this time.
The Congress has just begun consideration of tlie basic question of whether
the Refuge should be open to leasing. Accordingly, we believe decisions on
disposition of any revenues, should the Refuge be made available for a
lease program, could best be made in the context of whatever leasing
program is approved.

However, I can assure you that an active interagency process to develop a
comprehensive Administration proposal is underway. We expect to provide
this informatii^n to you, with our recoriTiendations.

To date, more than $6.6 billion has been appropriated from the Land and
Water Conservation Fund, with $2.3 billion going for National Park land
acquisition, $366 million for Fish and Wildlife Service land, $800 million
for the Forest Service, $29 million for the Bureau of Land Management, and
over $3.1 billion going to the States for their outdoor recreation
programs. With these funds, the Federal agencies have purchased the
followin-j acreages: National Park Service - 1,577,778; Fish and Wildlife
Service - 507,693; Forest Service - 1,200,000; and the Bureau of Land
rianagement - 262,217. The States have acquired 2,328,545 acres from the
state grant portion of the progran.

r*3w, however, the authorization for the Fund is expiring, and it is time to
explore new directions for meeting the objectives of the Fund, directions

more consistent with today's buc3getary realities, and that recognize the
achievements made under the L\CF in adding to the conservation and
recreational estates of the Nation. Over the past 7 years, Congress has
recognized that the money has simply not been available to fund the program
at the statutorily authorized level of $900 million annually. No more than
$335 million has been appropriated in any one year since 1980, and the
average annual appropriation over the past three years has been $160
million.

The Land and Water Conservation Fund is not a true trust fund, and contrary
to the common perception, neither the $900 million annual authorization nor
the hypothetical "$5.1 billion surplus" represents money sitting in the
Treasury waiting to be appropriated. It is a bookkeeping account, an
authorization, and nothing more. A more realistic analogy would be to the
ceiling or credit limit on a credit card, rather than the amount in a
savings account.

Just as an individual purchasing an item on his or her credit card must
repay the cost of the purchase, rather tlian using that money for other
needs, so any use of money authorized under the Land and Water Conservation
Fund represents either a diversion of that money from another use or, in an
option unavailable to the private citizen, a permanent increase in the
national debt. We must face this central reality of no real money sitting
on the shelf for the UCF if we are to create a workable future for Federal
conservation land acquisition programs.

The interagency group is exploring three basic concepts in our ongoing

review. One is a true trust fund for land acquisition; the second is a
simple reauthorization of the present Land and Water Conservation Fund with
a more realistic ceiling; and the third, similar in concept to S. 735,
would establish a mechanism for level or guaranteed annual funding in
amounts reasonably likely to be made available to the ajencies under
current budgetary conditions. We are also examining the questions of
whether additional Federal agencies should be authorized to receive funds
fron the new LWZF, whether these monies should be available for operation
and maintenance purposes as well as land acquisition, and whether the state
grant portion of the program should be continueii, and if so, in what form.

This concludes my prepared statement. I will be pleased to respond to any
questions you may have.

The Chairman. Secretary Horn, let me stop you at that point
and say, I have read your statement and I find it to be an excellent
statement. I am very pleased at your statement that you cannot at
this time recommend disapproval of S. 735.

Also, the first part of that sentence I just read out talking about
that you could not recommend approval — all I saw was that you
could not recommend disapproval, and I like that part of it very
much.

I also like the fact that you find some interesting concepts in the
bill, and I would say that this is as good as we can expect on this
Committee. And I think it is very, very encouraging, and I want
you to know I appreciate that position of you and Secretary Hodel
with respect to this legislation.

Let me ask you this. Suppose we do go ahead and authorize the
drilling on ANWR and this legislation were then up next year, or
let us say we authorize drilling on ANWR and they discover some
gas there, and then that goes into the federal budget's oil and gas,
and those revenues go into the federal budget, and then we propose
this bill the year after.

Do you think it would be as easy to get part of these revenues
once the stream of revenues gets into the federal budget, if it did?

Mr. Horn. Mr. Chairman, I think it would be more difficult. I
think there are an awful lot of people eyeing the prospective reve-
nues that could be generated from a leasing program in the 1002
area. Obviously, once those revenues are actually generated and
deposited in the General Fund, I think the competition within the
government for access to those funds is going to increase, rather
than diminish.

The Chairman. You say it is more difficult. That is really spelled
impossible, is it not?

Mr. Horn. Well, I guess we would say, "more difficult". Obvious-
ly, you all make the final decisions on appropriating the dollars. I
think the competition within the Executive Branch to lay claim to
those dollars would be far more intense after the fact than it is in
advance.

The Chairman. Now, Secretary Horn, recognizing that you
cannot take a position on this bill one way or the other, but let us
suppose that the Department were willing to endorse it — or wheth-
er you are willing to endorse it. I would like for you to look at the
bill as a mechanism just to see whether the mechanism works
properly and whether it is an efficient and proper and whether it is
the best use of these moneys if we are going to spend them in this
way.

Do you have any suggestions for us?

Mr. Horn. Within the Administration, as I indicated in the state-
ment, we are engaged in a very active program to try to put togeth-
er a comprehensive proposal dealing with the future of the Land
and Water Conservation Fund. Our efforts are focused in at least
three areas:

Number one, what is the best mechanism for us to employ?
Should we go with a simple reauthorization of the current fund,
this bank card account? Should we look at creation of a true trust
fund? Or should we look at some other type of a variant, different
contributed funds, or other ways of guaranteeing annual funding?

I think that we are very much interested in trying to explore dif-
ferent mechanisms, and the mechanism outHned in S. 735 is one
that we have looked at in our internal deliberations.

The second aspect we have looked at is what is an appropriate
funding level? Should the funding level be generated by the re-
ceipts that come in? If you earmark some sources of revenue,
should we pick a funding level that reasonably gets the job done in
terms of adding lands to the Federal conservation estate in a rea-
sonably planned fashion?

And then the third, of course, is coverage: should we deal solely
with Federal acquisition? What should be the future of the State
grants program? Should it continue and at what level and in what
form? And should the fund be expanded in different areas to deal
with items outside the narrow field of land acquisition?

Should it deal with various aspects of operations and mainte-
nance, which has been discussed at different times in the past?

So, we are trying to look at all three of those, and I must say that
the mechanical concepts in S. 735, are being scrutinized internally
at this time.

The Chairman. Thank you very much.

Mr. Secretary, I wish you would provide for the record a list of
the Department's top priority acquisitions for the Park Service, for
Fish and Wildlife Service, and for BLM. And you might give us
about your top, at least your top 20 in that respect, with the
amounts of money you think they would require, and if any of
them are to be acquired over a period of time any comments you
might have with respect to that.

[The information follows:]

U.S. FISH AND WILDLIFE SERVICE
APPROVED LAND AND WATER CONSERVATION FUND
NATIONAL PRIORITY LIST
July 23, 1987

NATL
RANK

PROJECT

REGION

TARGET

NSWH

1
1

Endangered
NSWH

Spp

2
4

Endangered
NSWH

Spp

NSWH

Wetlands

NSWH

3
5

Endangered
NSWH

Spp

NSWH

1
5

Endangered
NSWH

Spp

Wetlands

1
5

Endangered
NSWH

Spp

Wetlands

NSWH

Wetlands

Endangered
NSWH

Spp

Wetlands

2
3
5

Endangered
Endangered
NSWH

Spp
Spp

Wetlands

4
4

Endangered
Wetlands

Spp

Wetlands

Endangered
NSWH

Spp

NSWH

4
4

Endangered
NSWH

Spp

NSWH

Unassigned

1 LOWER RIO GRANDE NWR, TX

2 MATAGORDA ISLAND NWR, TX

3 ASH MEADOWS NWR, NV

4 SAN FRANCISCO BAY, CA

5 LESLIE CANYON, AZ

6 LOWER SUWANNEE NWR, FL

7 NATIONAL ELK REFUGE, WY

8 ANIMAS NWR, NM

9 ***MCKINNEY NWR, CT

10 ALLIGATOR RIVER, NC

11 J.N. "DING" DARLING, FL

12 DRIFTLESS AREA NWR, I A

13 TINICUM NEC, PA

14 CHARLES M. RUSSELL, MT

15 BLUNT-LI Z. T. , CA

16 GREAT SWAMP NWR, NJ

17 SUNKHAZE MEADOWS NWR, ME

18 BLUNT-LIZ. M&F, CA

19 TRUSTOM POND NWR, RI
2 PATOKA RIVER NWR, IN

21 KLAMATH FOREST NWR, OR

22 GREAT DISMAL SWAMP, NC/VA
2 3 MINNESOTA VALLEY NWR, MN

2 4 TREMPEALEAU NWR, WI

25 OKLAHOMA BAT CAVES, OK

26 TENSAS RIVER NWR, LA

27 FOX RIVER NWR, WI

28 ATWRTRS PRAIRIE CHICKEN, TX
2 9 KIRTLAND'S WARBLER, MI

30 EASTERN SHORE OF VA, VA

31 UPPER MISS. RIV. NWFR, MN

32 BAYOU SAUVAGE, LA

33 RAINWATER, NE

34 NATIONAL KEY DEER,

35 CHICKASAW NWR, TN

36 KENAI RIVER FLATS,

37 CRYSTAL RIVER, FL

38 STEIGERWALD LAKE, WA

39 ST. VINCENT NWR, FL

40 WERTHEIM NWR, NY

41 MISS. SANDHILL CRANE, MS

42 BON SECOUR NWR, AL

43 SWAN RIVER NWR, MT

44 LEE METCALF NWR, MT

45 BOGUE CHITTO NWR, LA

46 GREAT MEADOWS NWR, MA

*** Formerly Coastal Connecticut NWR, name changed by P.L. 100-38,
May 13, 1987

NSWH = Nationally Significant Wildlife Habitat

NOTES: (1) All projects have approved Preliminary Project
Proposals or other approved decision documents.
(2) This list supercedes the previous LWCF National
Priority List dated June 10, 1987.

National Park Service
Land Acquisition Priorities

Area

Acquisition Management

Deficiencies, Emergencies, Hardships

Inholdlngs

Appalachian NS Trail

Manassas NBP

Grant-Kohrs Ranch NHS

Alaska Parks

Olympic NP

Golden Gate NRA

Gulf Islands NS

Chattahoochee River NRA

Delaware Water Gap NRA

New River Gorge NR

John Day Fossil Beds NM

Cumberland Island NP

Cuyahoga Valley NRA

Voyageurs NP

Ebey's Landing N.Hlst.Pres.

Antletam NB

Acadia NP

Total

Amount

$6,500,000

6,000,000

5,000,000

14,000,000

2,000,000

600,000
5,000,000
3,000,000
4,000,000

800,000
7,000,000
3,000,000
5,000,000

250,000
1,000,000
5,000,000
4,000,000
79,000
1,000,000
3,500,000

$76,729,000

7/24/87

Pro.ject MajTve

Bur eau of Land Management
Pr iority L&WCF Projects

Total First

Acres to be Year
Acquired (Dollars)

1. Kins Range HCA. CI 940

2. Upper Missouri WSI. MT 2,200

3. Bizz Johnson Hafl. Trail, CA 200

4. Steens Mtn. Rec. Area, OR 4,700

5. North Fork American River, CA 1,621

6. Wilderness Inholdings Unknown

7. Carrizo Plains, CA 165,000

8. Desert Tortoise Nst'l. Area, CA 7,140

9. Owyhee River, ID 836

10. ChucVwalla Bench ACEC, CA 12,560

11. Birds of Preft ID 359

12. Chacoan Outliers N/A

13. City of Rocks, ID 400

14. Acquisition Kanagecent M/A

Total Priority UWCF Projects
NA - Not available

1,000,000
500,000
195,000
575.000
400,000

1,500,000

1,000,000
500,000
352,000
100,000
153,000
500,000
200,000

1.500.000

18,474,000

Out-Year
Dollars

1,000.000
600,000
255,000
-0-
1,000,000
Unknown
36,000,000
571,000
-0-
1,200,000
-0-
-0-
-0-
Unknown

The Chairman. I might say, I would also like for Mr. Dunlop to
provide the same information that is listed, your top priorities in
the Agricultural Service.

Mr. Dunlop. Yes, sir, we would be very pleased to try to do that.
I probably should advise the Committee, though, that because the
Administration over the past six or eight years has not asked for in
its budget a land acquisition program, we really do not have a na-
tional priority list.

What we do when the Congress then appropriates money in
these accounts, we take the accounts, break them down, and pro-
vide, make priorities that way. And that is what we would be pre-
pared to provide to the Committee forthwith.

The Chairman. Well, whatever information or advice you have
in that would be helpful.

Mr. Dunlop. Yes indeed.

The Chairman. Senator Murkowski, we will hear from Secretary
Dunlop in just a minute.

STATEMENT OF HON. FRANK H. MURKOWSKI, A U.S. SENATOR

FROM THE STATE OF ALASKA

Senator Murkowski. Thank you, Mr. Chairman. I am sorry, our
luncheon extended a little longer today. We were debating the
budget and, needless to say, we did not reach a conclusion.

I certainly appreciate the opportunity to hear the testimony for
your bill, S. 735, to modify the Land and Water Conservation Fund.
As I think you know, Mr. Chairman, I have some very grave con-
cerns about the bill, but the concept of a fund specifically designat-
ed for wildlife habitat is certainly something that is needed and
should be continued.

I support the theory behind the Land and Water Conservation
Fund, to use revenues generated from non-renewable resources to
acquire and protect renewable, pertinent resources.

In addition, I would agree that the Congressional failure to ade-
quately appropriate money from time to time from the Land and
Water Conservation Fund ought to be addressed by the Committee.

But I do not believe Senate Bill S. 735 establishes the proper for-
mula for addressing that problem. Although this bill is generic in
principle, it is my interpretation in practical reality that it will
most likely apply only to the Arctic National Wildlife Refuge,
ANWR in Alaska. And I intend to question the witnesses on that
specifically, Mr. Chairman.

As a consequence, it seeks to use revenues to which the state of
Alaska is legally and equitably entitled to pay for the acquisition of
valuable lands for the benefit of all Americans.

Other refuges have oil and gas potential, but I think it is mini-
mal compared to ANWR. And the Alaska Statehood Act specifical-
ly provided that revenues generated from the production of oil and
gas on federal lands in Alaska be divided on a 90-10 state-federal
distribution formula, and this was covered under the Mineral Leas-
ing Act as well.

And why the 90-10? Well, because Alaska was an undeveloped
state with a great need for revenues to be used so it was deemed
most appropriate. There was a genuine consideration as to whether

or not we could in fact support statehood, and because the other
states who relied on the reclamation fund were fearful about Alas-
ka's inclusion in the fund, because of our large land mass and the
unique demands.

Now times have changed. The 90-10 revenue sharing looks good
to other states, like a windfall to Alaska. So proposals have arisen
to change it.

The question that I must raise is, if we can so easily change Alas-
ka's formula, why not change other sharing formulas as well? The
reclamation fund could use an infusion of additional revenues.
Why not reduce other states' share of federal revenues from feder-
al leases to 25 percent and increase the reclamation fund accord-
ingly?

Mr. Chairman, I think we both know how a proposal of that
nature would fare. But the question remains, why treat Alaska dif-
ferently on this issue than any other state? There seems to be a
generally held perception that the 90-10 formula should be
changed because Alaska no longer needs revenues.

I grant you that Alaska has certainly benefited from the oil de-
velopment, but not at the expense of the federal government and
not by virtue of 90-10 revenue sharing. Prudhoe Bay is on state
lands and is therefore not subject to federal revenue-sharing formu-
las.

Has Alaska used the profits from oil development wisely? I be-
lieve it has, as do Alaskans. Mr, Chairman, we built much-needed
schools in our villages, hospitals, roads, bridges, airports — many
things that we did not have and many things that other states take
for granted and have had for a long, long time.

We have also created a state savings account, the permanent
fund, as a way of preserving some of the revenues from develop-
ment of our resources, some of the revenues, Mr. Chairman, from
non-renewable resources such as oil.

But that does not mean that Alaska no longer has need for reve-
nue. Mr. Chairman, you have heard me say before that Alaska is
unique. You have been to our state and you are well aware of that.

How many other states have more than 227 million acres of fed-
eral land within their borders, 38,000 miles of coastline? How many
other states have 48 million acres of national parks, 53 million
acres of national wildlife refuge, and 56 million acres of designated
wilderness?

How many other states are there where the only means of access
to over 95 percent of its communities is strictly by air or water, no
other means available, no surface transportation?

In how many other states does a gallon of milk cost $4.50 in a
village because of freight costs?

Maybe it is appropriate, in light of changed circumstances in this
state, to consider revising the 90-10 formula. But any such propos-
al should be developed with Alaskan consultation and concurrence,
not in a take it or leave it basis.

In conclusion, while I support your efforts, Mr. Chairman, to ad-
dress the Land and Water Conservation Fund problems and I
pledge my support to work with you to develop alternative situa-
tions, I cannot support this bill at this time, which proposes to sup-

port the fund pretty much exclusively as far as my identification is
concerned at the expense of my state of Alaska.

Thank you, Mr. Chairman.

The Chairman. Thank you very much, Senator Murkowski.

Mr. Dunlop.

STATEMENT OF GEORGE S. DUNLOP, ASSISTANT SECRETARY,
DEPARTMENT OF AGRICULTURE

Mr. Dunlop. Mr. Chairman, I have a prepared statement which I
might submit for the record, and then I might just draw three
fibers from the fabric, if I may, to highlight some of the points that
we have.

The first point I would make is that the Department of Agricul-
ture supports the concept of the Land and Water Conservation
Fund, as past accomplishments have provided for the acquisition of
very valuable recreation property. In fact, the Forest Service com-
ponent over the years has been about 22 percent of the total feder-
al program.

The second point I would make, Mr. Chairman, is that, because
of the already very large current federal estate, the past accom-
plishments we have made as well as the federal deficit and current
demands on the federal budget, we believe that a continued large
land acquisition program is really not necessary.

Land exchanges and other types of activities in which we can
engage do exist under current authority that allows the Forest
Service to make necessary land ownership adjustments. And I
might point out, for instance, that in 1986 133,000 acres of non-fed-
eral lands were exchanged, for 101,000 acres of national forest
system lands, at an administrative cost of only $5.2 million.

That same year we acquired approximately 43,000 acres for $31
million. Thus, in 1986 the Forest Service acquired three times the
amount of land by exchange than by purchase, and for only one-
sixth of the cost.

Of course, we recognize that purchase is absolutely necessary in
many instances and exchange does not always work. But we have
proposed to Congress that we continue to work together with the
management agencies to simplify and expedite the types of things
that we can do under existing authority.

It would be my hope and our hope at the Department of Agricul-
ture that as we work on these land acquisition matters that would
be included under this account, perhaps this process could be
moved along a little if we established some hierarchical order to
the process once we have decided upon the particular tracts.

In other words, give precedence to, let us say, those tracts that
involve some element of exchange or some element of donation or
perhaps an element of acquisition of partial interest, maybe reduc-
tion in the acreage and that kind of thing.

We are very, very pleased at the feedback we have had from the
Committee staff, both here and the other relevant Committees, to
look at some way in which the Administration would be able to
come up with a land acquisition program that would be the kind of
thing that Congress could work with.

77-689 - 87 - 2

As you know, we have come up with a zero amount every year,
and that frankly does not give you the input you need. And I am
looking for ways to try to work that out.

And so the third point I would make in that regard is that at
this stage of the game, this stage of consideration, the Department
of Agriculture could not recommend the enactment of a bill as it is,
nor oppose the enactment as it is.

We are very eager to work with you. As Assistant Secretary
Horn just said, we have got a very, very active inter-agency, inter-
Departmental effort under way. We feel an obligation as an Ad-
ministration to come to this Committee and come to you and say,
here is our very best thinking on this and we would like to have
those thoughts considered by the Committee.

Unfortunately, we are not ready today to do that. But we should
be after the August recess.

[The prepared statement of Mr. Dunlop follows:]

STATEMENT OF

GEORGE S. DUNLOP. ASSISTANT SECRETARY

UNITED STATES DEPARTMENT OF AGRICULTURE

before the

Subcommittee on Public Lands, National Parks, and Forests

Committee on Energy and Natural Resources

United States Senate

Concerning S. 735

JULY ll^. 1987

MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:

Thank you for the opportunity to present our views on S. 735. a bill "To amend
the Land and Water Conservation Fund Act of 1965, Emd for other purposes."

The Department of Agriculture recognizes the past accomplishments and valuable
contributions of the Land and Water Conservation Fund (L&WCF) . Since the L&WCF
program began in I965. approximately $3.5 billion have been appropriated for
Federal land acquisitions. The Forest Service expenditures exceed $800 million
or approximately 22 percent of the total Federal program. Nearly 1.2 million
acres have been acquired within the National Forest System. We support the
concept of the Land and Water Conservation Fund, as past accomplishments have
provided for the acquisition of valuable recreation properties.

S. 735 would create a separate fund, to be available witliout further
appropriation, consisting of two sources: (1) $l60 million per annum, to be
derived from the authorized but unappropriated balance of the L&WCF fund; plus
(2) 25 percent of all revenues received from competitive bids, sales, bonuses,
royalties, rents, fees, interest charges, or other income derived from the
leasing of oil and gas resources within units of the National Wildlife Refuge

System. The appropriations committees would be directed to appropriate the
fund in accordance with a priority list prepared by the Directors of the Bureau
of Land Management, National Park Service, Fish and Wildlife Service, and Chief
of the Forest Service. If the appropriations committees fail to allocate funds
from this special account, the Secretary of the Treasury would be authorized
and directed to make such funds available to the land managing agencies in
accordance with the following formula:

'to percent to the National Park Service;

^0 percent to the Fish and Wildlife Service;

15 percent to the Forest Service; and
5 percent to the Bureau of Land Management.

In consideration of the current Federal estate, past accomplishments, and the
Federal deficit, we believe a continued large land acquisition program is not
necessary. Other authorizations exist that allow the Forest Service to make
necessary landownership adjustments. Recent budget requests for L&WCF were
directed only towards providing administrative funds necessary for the
completion of cases funded from previous year appropriations and for pursuing
land exchange cases that qualify under L&WCF criteria. Land exchanges were
planned to acquire other high priority tracts. In I986, 133,000 acres of
non-Federal land were exchanged for 101, Si** acres of National Forest System
lands -- at an administrative cost of $5.2 million. In that same year, '43,165
acres were purchased for $31 million. Thus, in I986, the Forest Service
acquired three times more land by exchange than by purchase for one-sixth the
cost. We recognize that purchase may be the only viable means of acquiring
certain tracts. However, we are emphasizing land exchanges by offering
non-Federal landowners the opportunity to pursue an exchange as an alternative
to Federal purchase of their land.

We propose that the Congress continue to work with the land management agencies
to simplify and expedite the donation and exchange processes to acquire high
priority lands. Land acquisition, either by purchase or exchange, is a
long-term process that requires extensive planning, assessment of Federal
needs, economic analysis, and prioritization. Then, consideration must be
given to the most cost effective method of landownership adjustment. This
process includes the following options: (1) donation of land; (2) land
exchange; (3) acquisition of partial interest; C*) reduction in acreage; and,
if absolutely necessary, (5) cash purchase. We will continue to emphasize
land exchange as the primary means of landownership adjustment for the Forest
Service and as a more desirable alternative to purchase.

We have no position on S. 735 at this time. This bill addresses only a few of
the many questions, Issues, and concerns relating to how the entire L&WCF
program should be funded and administered. An active Interagency process Is
ongoing to develop a comprehensive Administration proposal. We expect to
provide this information, with recommendations, to you shortly.

This concludes my testimony. We look forward to working with the Subcommittee
as you consider amendments to L&WCF and other Issues dealing with land
acquisition processes that will improve ownership patterns on the National
Forests and better provide for public needs. I will be happy to answer your
questions or provide any additional information you may desire.

The Chairman. Thank you very much for that, Secretary
Dunlop.

I want to urge you and Secretary Horn to work with us on this,
because we want to give you a maximum of flexibility. I mean,
with respect to all of these acquisitions, we want the Department,
all Departments, to be able to get the best targets of opportunity.
And you have got to have flexibility to do that.

As far as I am concerned, I would like to see you acquire the
least amount necessary to achieve the job. Sometimes that might
be an easement of use, or a site or something less than fee acquisi-
tions, sometimes something exchanged — all of these different
things for which you need flexibility.

Now, at the same time the fundamental tenet of the bill is to
make this an automatic appropriation so that we do not get caught
up in somebody's budget each year, assuming we do open ANWR
and assuming there is oil and gas there, that we will not get
caught up in the budget crunch every year and have them taking
away this.

Because, as you know, it is a whole lot easier to defeat a bill. So
if you can just defeat, defeat with 41 votes somebody's grab of
parks and agricultural lands, then it will be automatic.

So we have to reconcile those two views, the flexibility that you
need and the automaticity, if that is a word, on the other hand.
And so I hope you will be thinking about that soon.

I hope we can make this bill happen fairly fast. Our friends in
the environmental community up to this point are opposed to the
bill, not because they do not recognize there are great needs for
parks, but because they do not want, if I can judge their motives,
they do not want any of their fingerprints to be put on the opening
up of ANWR.

And all of the words and repetitions that I could make that the
two issues are unrelated have thus far been not of assurance to
them. But I hope that their opposition will be more formal than
intense, because I would like to make this thing happen and soon.

You know, it is one thing to make a formal opposition and it is
another thing to try to mobilize and energize all the troops. If they
do not do the latter, then I hope we can make this bill happen
pretty soon and then forget about this bill.

If we never open up ANWR, it has not done any harm at all. If
this Congress does not, but some other Congress does, then that
money will be there for them.

Mr. Dunlop. Well, you know, Mr. Chairman, I might give you
encouragement in that regard, because in the past year that I have
had the occasion to serve in the Administration — as you may know,
I served for a number of years up here on the Hill, twelve years as
a Committee staff director — I can attest to the fact that the ability
of the Congress and the Administration to work together, to work
out a sensible, predictable policy in this is a very, very needed
thing.

Both the Congress needs it and the Administration needs it. The
public needs it. So your effort in this regard is something that we
pledge sincere cooperation toward, just because it is the right thing
to do and it will allow planning to go ahead and the other issues

then to be resolved, rather than the constant frustration that we
face as we deal every year with this complicated question.

So you are right on target from our point of view at the Depart-
ment, and we are your willing and obedient servants, as they used
to say.

The Chairman. Well, I appreciate that very much. Secretary
Dunlop. And if both of you will give us your best advice on this
mechanism and soon, because I would like to bring it up very, very
fast, I mean, giving everybody a chance to have his say, but I
would like to make it happen fast and I hope we could, on the con-
sent calendar.

This would not be the first bill that I would hope that could be
on the consent calendar that ran into opposition later on, but I
would hope it could be done in that way.

Senator Murkowski.

Senator Murkowski. Thank you, Mr. Chairman.

It is my understanding that in the Land and Water Conservation
Fund there is about $5 billion currently. About $900 million is
coming in annually, and yet we are expending about $160 million a
year.

Mr. Horn. Well, Mr. Chairman, the way it works is that the cur-
rent fund is really like a credit line from the bank, and the credit
line is up to $900 million annually. Yes, there is an accrued bal-
ance, so to speak, of $5.2 to $5.3 billion. But there are no actual
dollars in an account, unused, any place.

In other words, there are no unused, unappropriated dollars sit-
ting there on the shelf for Congress to take off. All of those dollars
have been expended by Congress and the Executive Branch for
some other activity.

So it is basically unused authority that is still out there.

Senator Murkowski. Well, you are expending out of the author-
ity $160 million?

Mr. Horn. That is because those have been appropriated dollars
pursuant to an act of Congress.

Senator Murkowski. So what you are saying is the appropriators
will not give you the appropriation for any more, even though you
have the authority?

Mr. Horn. We have not asked. As a matter of fact, we have been
asking for rather limited amounts, and Congress has been giving us
more than we have asked for.

Senator Murkowski. What would change on this if S. 735 were
to become law?

Mr. Horn. Well, the way we read it, I think as the Chairman
noted earlier, is that we would end up with a far more automatic
program, that a substantial sum of money would be made avail-
able, not subject to appropriation, on a more-or-less automatic basis
for land acquisition purposes.

Senator Murkowski. It is currently my understanding that
about $2.5 million are coming in from leases on refuges?

Mr. Horn. It is not an enormous sum of dollars, and I would
have to get for the record the exact number. But it is somewhere, a
de minimis sum, when you compare it to OCS revenues and some
of the other elements that are earmarked for LWCF.

[The information follows:]

Oil and gas receipts for refuges in the lower-48 States

Fiscal year 1986 acquired lands:

Hatchie NWR, TN $1,095.50

Delta NWR, LA 1,359,858.90

Sabine NWR, LA 18,744.13

Medicine Lake NWR, MT 324,409.60

Des Lacs NWR, ND 3,497.52

J. Clark Salyer NWR, ND 122,691.36

Upper Souris NWR, ND 61,347.70

Quivira NWR, KS 3,018.21

Pathfinder, CO 40.00

Total 1,894,702.82

Senator Murkowski. Can you identify other wildlife refuges
other than ANWR that have a significant oil and gas or mineral
potential?

Mr. Horn. Basically, most of the refuges that have potential
where that mineral estate is retained by the Federal Government
are probably in the State of Alaska. Most places where we have oil
and gas activity in units of the refuge system — and there are about
40 to 50 such units out of the 430-plus units of the system overall —
are where we acquired the surface only and private ownership re-
tained the subsurface. Then we have worked out arrangements to
let them continue to extract their private minerals while we own
the surface estate and manage that for wildlife protection purposes.

In those cases, of course, there are no revenues being generated
for the Federal Government, and no disposition or deposit in any
type of a fund. So the only unit where the Administration is pro-
posing any oil and gas leasing activity on our own is in the coastal
plain portion of ANWR. In the other 430 units, we are not propos-
ing any oil and gas activity on our own.

Senator Murkowski. So obviously, this would trigger in ANWR
if indeed it did become law more significantly than any other iden-
tifiable refuge?

Mr. Horn. Yes, sir. I think the 1002 report indicates that we are
looking at prospective bonus revenues in the $2 to $3 billion range,
potentially. Of course, I do not think we have another unit of the
system that is anjrwhere close to that.

Very clearly, that is the most outstanding frontier oil and gas
area we have been able to identify, and as a consequence, it would
generate the lion's share of the dollars.

Senator Murkowski. My last question has to do with the process
of identifying desirable areas to be added to our treasurehouse of
unique and pristine wilderness areas, conservation areas, and so
forth.

Do you, as a Department of Interior, formally sit down and iden-
tify those acquisitions that you would like to obtain? And is it
pretty much limited under the LWCF acquisition process?

Mr. Horn. Mr. Chairman, when I took office one of the things
that perplexed me was that we did not have a system in place to
identify exactly what our priorities were. Both the National Park
Service and the Fish and Wildlife Service have worked over the
past years to generate an objective resource priority program with
a series of specified criteria built into it. We of course are in the
position to provide that outlines to the Committees. It shows if we
have X dollars, here is what we would acquire.

Senator Murkowski. So you do this internally? You identify in-
ternally?

Mr. Horn. We have generated that internally as our own initia-
tive.

Senator Murkowski. Okay. In this process, various environmen-
tal groups perhaps come in and make suggestions to you. Do you
take their recommendations and consider them?

Mr. Horn. It is not any type of a public process right now. It is
being conducted by the resource professionals within the agencies,
pursuant to these objective criteria that we established in advance.

Senator Murkowski. I see. Is there any reason that you do not
respond to environmental groups that may have suggestions that
you acquire specific lands for a purpose that corresponds with their
particular cause or interest?

Mr. Horn. I think we do, but I think the system is essentially ad
hoc. We have people come to us with different proposals and differ-
ent ideas on areas to acquire. We have our people evaluate and
review those proposals.

If, of course, the resource professionals are duly persuaded, that
can be incorporated into our priority list, if indeed the attributes of
that particular parcel of land satisfy the criteria that we have es-
tablished.

Senator Murkowski. Can you tell us, in the case of Alaska, if
there are currently any areas that have been identified by various
environmental groups or special interest groups that they would
like to see become part of the Federal withdrawals?

Mr. Horn. Right now we have nothing per se on the resource
priority list because, as you are well aware, we can obtain lands in
Alaska only on a willing-seller basis. We cannot acquire through
condemnation, which is authority we have in the Lower 48.

We obviously have intense interest in acquiring some of the key
wildlife parcels. There are approximately 10 million acres of native
inholdings within the wildlife refuge system in Alaska, and some of
those lands are of extremely high value. We of course are interest-
ed in obtaining those lands.

Senator Murkowski. But is it because Alaska does not belong to
the Land and Water Conservation Fund and participate that you
cannot use that? I thought the funds could be used outside the indi-
vidual state if it was deemed in the interest of the government?

Mr. Horn. The funds can be used. We have not come up with
any particular small parcels that are of sufficient priority to buy.

Obviously, one of the problems is that the extent of the inhold-
ings in Alaska is so large that we could spend the entire balance if
we were to go after some of those inholdings. We are talking about
hundreds of thousands of acres of land, of inholdings within the
refuges, whereas in the Lower 48 we are sometimes talking about
picking up inholdings measured in tens of acres.

Obviously, if we started committing our limited cash resources to
the Alaska inholdings, we would break the bank.

Senator Murkowski. Well, is it your interpretation that the ap-
plication of this legislation, S. 735, as you have already testified
that the identifiable revenue would come from refuges in Alaska,
that it would necessarily mandate that it be expended in Alaska?

Or would it purport that it could be expended anywhere?

Mr. Horn. My understanding is it could be expended anywhere
pursuant to these land acquisition priority lists. Indeed, that is one
of the features of S. 735 that we are very supportive of, the idea of
having the land acquisition program being driven by these re-
source-based priority systems.

Senator Murkowski. You said that there was not enough money
from the LWCF currently in appropriations to acquire some of the
identifiable lands, ideal lands, in Alaska. So Alaska would have no
assurance, then, even if S. 735 passed, that identifiable lands in
Alaska that were desirous of going in the system would necessary
go in.

It may be other refuges, so we have complete exposure and no
assurance that it is going to be beneficial to holdings in Alaska,
and that it would be beneficial to the federal government manag-
ing. Is that correct?

Mr. Horn. I think it would depend upon how those particular in-
holdings ranked on the overall land acquisition priority.

Senator Murkowski. Nationally, as opposed to within our state?

Mr. Horn. Yes.

Senator Murkowski. And nobody, including environmental
groups, is banging down your door, proposing that things in our
state happen, in other words that acquisitions be acquired on iden-
tifiable land that could be added to a wilderness area, a wildlife
area, and so forth?

Mr. Horn. We have had three or four relatively small cash ac-
quisitions approved by Congress during the period I have been at
the Department: the Gagnon property in Wrangell-St. Elias Park,
and some appropriations for purchases at Tazumin Lake Basin, an
inholding in Lake Clark National Park.

Most of our acquisition of inholdings in Alaska in parks and ref-
uges has been by exchange since the Alaska Lands Act passed, and
in combination of exchanges, arrangements with the state, unrelin-
quished donations, and such. We have been able to add over a mil-
lion acres to the parks and refuges in the state through a series of
transactions with the use of the exchange authority.

Senator Murkowski. Well, Mr. Chairman, I kind of feel like the
bride that has been put up by her father without much to say
about the ultimate disposition of her future, because it appears to
me our state is in the unique position here of being afforded,
indeed, under the legislation the opportunity to fund, but not have
the assurance that the acquisitions would necessarily take place.

And that concerns me greatly. Since we do not seem to have had
a great deal of evidence exhibited by various groups that want to
see specific exchanges take place in Alaska, I guess I have a hard
time interpreting the need of this legislation as being beneficial to
our particular state.

And I certainly recognize that there are 49 other states as well to
be considered, but speaking from a strictly singular point of view,
it does seem that it is pinpointed from a revenue generation at our
state.

I want to thank you for the time you have allotted me to make
our particular point of view heard.

The Chairman. Senator Bradley.

Senator Bradley. Thank you very much, Mr. Chairman.

I would like to ask Mr. Horn, what are the three or four places
that you would see the greatest revenues being derived from the
decision to allow 25 percent of revenues of future oil and gas leas-
ing in national wildlife refuges to go to this special fund?

Mr. Horn. Very clearly, the only unit of the refuge system that
would generate any appreciable oil and gas revenues would be the
coastal plain portion of the Arctic Wildlife Refuge if Congress
chooses to open that area up.

Senator Bradley. You cannot conceive of any other place where
there might be any revenues?

Mr. Horn. There is some appreciable, significant — pick the term
one wishes — potential within some of the other refuge units in
Alaska, where Congress, through section 1009 of the Alaska Lands
Act, has specifically authorized the creation of what is called the
North Slope leasing program.

Those areas have some potential, but right now it is rather limit-
ed. Depending upon what the geologists might find, that potential
could increase. But right now I do not think anybody could predict
any appreciable or significant revenues from leasing any other
non-ANWR refuges in Alaska for at least the next ten years.

Senator Bradley. Could you imagine any in the lower 48?

Mr. Horn. As I indicated earlier, for most of the refuges in the
Lower 48 where we have acquired sub-surface estate along with the
surface estate, we have no intention to offer leases.

We have the authority to do so under the Refuge Administration
Act pursuant to a compatibility determination, but it has been the
Secretary's basic policy that we are not interested in leasing or
pursuing oil and gas leasing in any other units of the wildlife
refuge system in the Lower 48.

Senator Bradley. But in terms of oil and gas potential, what
would be three or four in the Lower 48 that would have significant
oil and gas potential?

Mr. Horn. I would have to check with the geologists. I think that
there are some with some potential. It would be difficult to say
that there are any in the Lower 48 that have significant potential
where the Federal Government has retained the sub-surface estate.

There are a number of refuges, where private owners have re-
tained the sub-surface, that have significant oil and gas. I think of
the Atchafalaya unit we have recently established in Louisiana
with the cooperation of the Chairman.

But there, of course, the potential has been retained by the pri-
vate owner. That is generally the case where you have appreciable
oil and gas in the Lower 48 areas.

Senator Bradley. Any other places other than at Atchafalaya?

Mr. Horn. No.

Senator Bradley. Whether the government retains the rights,
sub-surface rights, or not, at least the area is under the manage-
ment as a wildlife refuge.

Mr. Horn. For example, in Atchafalaya we have a special ar-
rangement with the sub-surface owner where we negotiated a con-
tract, and that contract specifies how he will operate on that land
to ensure protection for surface values.

I can provide for the record the Ust of other units of the refuge
system where our geologist might see some potential for oil and
gas.

But as I indicated, the Secretary's present policy is not to pursue
leasing of any of those refuge units in the lower 48.

The Chairman. If the Senator would yield, there is some produc-
tion right now on some refuges in Louisiana.

Senator Bradley. I have seen them, and I am just trying to, if I
can, get a sense of what the universe is here. So if you have looked
at that document, could you remember any more, or do you want
to just provide it for the record?

Mr. Horn. I think I had better provide it for the record. I know
that there is a list of 40 or 50 units with some potential.

[The information follows:]

This information was prepared in early 1983 while leasing on refuges was being
considered. The Service did not complete the identification of refuges overlapped by
known geologic structures prior to the no-lease policy.

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I'.MOwn Geologic Structures riverlappinq ^ish and Wildlife Service Sefuges

North Central Region

State

Wyoming

Montana

Wildlife Refuge
Seedskade

Bowdoin

Hewitt Lake

North Dakota J. Clark Salyer

North Dakota Upper Souris

KGS

Storm Shelter

Bowdoin

Kane

Newburg-South
West Hope

Starbuck

Starbuck
Southwest

Tol ley

Lake Darling

Unnaned

Description of Overlap

T.23N., R.lllW., 6th P.M., WY
sec. 15, SE 1/4 SW 1/4 and

S 1/2 SE 1/4;
sec. 21, N 1/2 NE 1/4 and

NE 1/4 NW 1/4.

T.31N., R32E., P.M., MT
sec. 28, SW 1/4.

T.32N. . R32E., P.M., MT

sec. 7, SE 1/4; Sec, 8, S 1/2;

sec, 9. W 1/2 SW 1/4; sec. 16, NW 1/4;

sec. 17, N 1/2; sec.l8.

T.162N. , R.79W., 5th P.M., ND
sec. 27, NE 1/4 SE 1/4;
sec. 34, E 1/2 NE 1/4,

T.161N., R.79W., 5th P.M., ND
sec. 3, W 1/2 SE 1/4;
sec, 10, NE 1/4 and NE 1/4 SE 1/4;
seen, W 1/2 W 1/2, E 1/2 SW 1/4,

and SW 1/4 SE 1/4;
sec. 14, W 1/2 NE 1/4, NW 1/4, N 1/2

SW 1/4 and NW 1/4 SE 1/4.
T.162N., R.79W., P.M., MT
sec. 17, SW 1/4.

T.161N. , R78W., 5th P.M., NO
sec. 19, W 1/2 SE 1/4;
sec. 30, E 1/2.

T.160N., R79W. , 5th P.M., ND
seel, lots 3 X 4, S 1/2 NW 1/4;

SW 1/4, and W 1/2 SE 1/4;
sec, 2, lots 1 8 2, S 1/2 NE 1/4;

and SE 1/4;
sec. 12, 1/2 NE 1/4. NW 1/4, N 1/2

SW 1/4, and NW 1/4 SE 1/4.
T.161N., R.79W., 5th P.M., ND
sec. 31, S 1/2 SE 1/4.

T.161N. , R.aeW., 5th P.M., ND
sec. 3, E 1/2 SW 1/4 and SE 1/4;
sec. 10, NE 1/4 and N 1/2 SE 1/4.

T.159N., R.85W., 5th P.M., ND
sec. 35, E 1/2 SE 1/4;
sec. 36, SW 1/4.

T.159N., R.85W. , 5th P.M., ND
sec. 22, NE 1/4.

County

KNOWN GEOLOGIC STRUCTURE'S
ARKANSAS (Counties)
Number of KGS's

Frank! in

Crawford

Logan

Sebastian

Yell

Johnson

Pope

Conway

Faulkuer

VanBuren

CI eburne

Miller

Quachita

Parrish

E. Baton Rouge

St. Charles

Jefferson

LaFourche

Terreboune

Morehouse

Richland

Caldwell

Quachita

Union

Lincol n

Jackson

Bienville

Claiborne

Webster

Bossier

Caddo

DeSoto

Red River

Natchitoches

Winn

Catahoula

LaSalle

Grant

Cameron

Jefferson Davis

Vermill ion

Lafayette

St. Martin

Iberia

St. Mary

Iberville

Pointe Coupee

Plaquemines

Total Acres

1/1/83

362,762

LOUISIANA (Counties)

Total acres

1/1/83

857,761

Senator Bradley. Would you provide some sense of the potential
in each of those.

Mr. Horn. Yes, sir.

Senator Bradley. Let me ask you, how much money was spent
for land acquisition in the last year?

Mr. Horn. The aggregate appropriation was approximately $160
million, parceled out among the National Park Service, the Fish
and Wildlife Service, and the Forest Service.

Senator Bradley. And this is for new acquisition?

Mr. Horn. Well, it is basically acquisition of inholdings, and in
some cases new areas. The Fish and Wildlife Service frequently ac-
quires new areas that have been added to the system. The Park
Service focuses on inholdings.

Senator Bradley. But they were only inholdings within the exist-
ing wildlife refuges or parks?

Mr. Horn. No, the Park Service, at least in my area, focuses on
buying lands within Congressionally authorized boundaries. The
Fish and Wildlife Service authority is somewhat different. It can
identify parcels it deems to be important.

Once those are acquired, we have the administrative authority to
deem those acquired lands a unit of the wildlife refuge system.

Senator Bradley. But when it says new land acquisitions, do you
interpret that to mean inholdings within existing parks and refuge
areas, or do you interpret that to mean adding new parks?

There is a long list — as you are aware, there is a long list of
things that have been authorized, but never purchased.

Mr. Horn. Most are inholdings.

Senator Bradley. Well, in terms of, would you view this as reve-
nues that could be used for something other than inholdings?

Mr. Horn. Well, as I said, with the National Park Service, we
are constrained to purchase lands that are inside Congressionally
authorized boundaries. The only place that we can acquire land
beyond the boundaries is for the Fish and Wildlife Service, and
generally there we pick up lands that are important for migratory
waterfowl with migratory bird funds, or we purchase lands that
are important for endangered species with the Land and Water
Conservation Fund.

Then, after we have acquired x acres, we administratively desig-
nate those lands as part of the refuge system. So, I would say that
our park acquisitions are inholdings-driven; our refuge acquisitions
are partially inholdings, partially for migratory waterfowl, and
partially for endangered species.

Senator Bradley. Let us say that I introduced a bill to declare
Montgomery County a national park. Would the money be avail-
able to purchase any lands in this newly authorized park?

Mr. Horn. Not at this time. As a matter of fact, one of the issues
that we have addressed in the past is that when Congress sets
these units up, we have expressed concern about making sure that
simultaneously we identify sources of revenue or means of acquir-
ing the land to be added to these units of the system.

Senator Bradley. So it is your view of the legislation that none
of the money could be spent to purchase land in new elements of
the parks system?

Mr. Horn. No, if Congress authorizes a new unit of the parks
system and draws a dotted line on the map, we would then have
the authorization to expend funds generated by this mechanism to
acquire the lands inside that Congressionally authorized boundary.

Senator Bradley. Thank you very much.

The Chairman. Senator Wallop.

Senator Wallop. Mr. Chairman, first let me ask that a state-
ment that I have in general support, expressing some reservations
on behalf of the Western Governors, be inserted in the record.

[The prepared statement of Senator Wallop follows:]

statement by Senator Malcolm Wallop, a Senator from Wyoming
Before the Public Lands, National Parks and Forests Subcommittee

Hearing on S. 735, a bill to amend the Land and Water
Conservation Fund Act of 1965, and for other purposes

Good afternoon. Mr. Chairman, I shared with you, as a co-member
of the President's Commission on Americans Outdoors, the concerns
which the Commission faced in providing funding for the
recommendations of the Commission. As you know, I declined to support
the recommendation for a funding not subject to the appropriation or
budget realities of our time.

Your bill provides a minimum base of $160 million annually to be
spent without further appropriation and would have the potential of
added millions of dollars should your bill be enacted, and leasing and
production occurs in ANWR.

Under current law the prospective mineral leasing receipts from
ANWR would not be distributed to the Reclamation Fund. The State of
Alaska currently receives 90 percent of mineral leasing revenues; 10
percent goes to the Treasury.

The State of Alaska has concerns with possible changes in that
ratio. Leasing revenues from units of the National Wildlife Refuge
System established from the public domain are credited in accordance
with the provisions of the Mineral Leasing Act (30 U.S.C. 191) 50
percent to the state in which the refuge is located and 50 percent to
the U.S. The 50 percent federal portion is further divided with 40
percent going to the Reclamation Fund and 10 percent to Treasury.

The Reclamation Act of June 17, 1902 (32 Stat. 388) which
established reclamation of the arid and semiarid lands of the West as
a federal activity, included the provision that financing of the
Federal undertaking should be accomplished through the Reclamation
Fund, a special fund to be established within the Treasury of the

United States. The fund was duly established and supported in the
beginning by proceeds from sales of public lands of the United States.
It was later augmented by a percentage of the royalties from oil and
other mineral leases on lands of the United States, collections from
the projects, and from other sources.

Although not a lot of money accrues to the Reclamation Fund from
ineral leasing on units of the National Wildlife Refuge System
established from the public domain, I have several reservations about
the precedent established. The Western Governors have expressed some
of the same concerns and the State of Alaska has major heartburn.

Let's assume that Congress does establish a permanent
appropriation as contemplated in S. 735. I would argue for a
different distribution formula which would have a state portion and
perhaps a development portion for the federal side as contemplated by
the drafters of the original Land and Water Conservation Fund Act.
But that is all hypothetical.

My understanding is that the Budget Committee is objecting to the
formula and permanent appropriation authority in the Park Fee bill
(H.R. 1320 as reported). This is the glue that holds the fee issue
together. Without those funds going to the areas as decided by the
Committee, I'm not sure the effort is worth it. The same applies to
S. 735.

The distribution of the mineral royalties and receipts is a well
established precept with equity. We must be very careful in
read j ustments .

Senator Wallop. I want to explore something here, because I
think it is a little alarming. I do not think this in any way con-
strains itself to the acquisition of just new lands.

Senator Bradley. No, I was not saying it constrains itself to just
the acquisition. I was saying, would it be permissible under the Act
to acquire new lands. I was not saying, are you confined to that.

Senator Wallop. Well, I do not think in either dimension that it
says yes or no.

Senator Bradley. That is why I was asking him what his inter-
pretation is.

Senator Wallop. The problem is, and I want to examine just one
thing, the view of the Department on the recent court case in Cali-
fornia, and whether it has implications to you on the huge backlog
of authorized but unacquired and unfunded lands in the systems of
the national parks, the national wildlife refuge system, or scenic
areas, or recreation areas, or all the other things that we authorize
here?

Is it the view of the Department that the case has a potential
impact?

Mr. Horn. It has raised substantial concerns, and I would say
that it is just one more concern that has been added to a growing
list.

When we look at acquisitions, for example, we have found that
we end up in condemnations, that we end up spending about 150
percent of our appraised price if we go through condemnation. If
we are forced to the point where we have to file a declaration of
taking, we are losing awards and they are generally in the vicinity
of 200 percent of our appraised value.

I think most of the members of the Committee are aware of the
adverse ruling we had in the Redwoods case that now puts our li-
ability for completing that unit of the park system at over a billion
dollars.

We add those up, coupled with the recent Supreme Court case,
and I think that the level of exposure that we are facing on inhold-
ings is growing. Of course, we have been stuck in the box of, on the
one hand, trying to deal with the budgetary constraints and, on the
other hand, trying to acquire some of these needed lands that are
important for wildlife or to minimize takings exposure.

Hence, that is why we have been so active in the land exchange
business, or at least trying to be active.

Senator Wallop. Well, I am all for that, having worked so hard
to get there. You have heard me express my anxiety as to what is
going to happen with Congress' huge appetite for authorizing,
having no stomach at all for appropriating.

I mean, we will authorize anything and fight when it comes to
authorizing an area, but when it comes down to paying for it, we
just don't do it. There is no real passionate pursuit of providing
funding from any corner.

People will say from time to time that somebody ought to do
something about this or that, but we have exercised no restraint at
all. And that is one reason why I am in general support of this bill
and hope that, while nothing prohibits it from new acquisitions, I
hope that our acquisitions of newly authorized — I hope that the

Congress can find it in itself to restrain its authorizing, so that it
deals somewhat with this enormous backlog.

But the Redwoods case is now a billion dollar backlog. That back-
log that we were talking about around two to four billion dollars is
probably somewhere between six to nine billion dollars.

Senator Bradley. Do you mean that authorized purchases total
$6 to $9 billion?

Senator Wallop. I would think we are very close to that by now,
given the court rulings.

The Chairman. If the Senator would yield. It is certainly the in-
tention of the bill to deal with that authorized backlog, not to pre-
clude some new priority if the Congress feels that it should be
there, but principally to deal with that backlog.

Senator Wallop. Thank you.

The Chairman. Gentlemen, thank you very much, and we look
forward to hearing from you as further advice on this matter.

Mr. Horn. Thank you, Mr. Chairman.

The Chairman. Next we have John W. Katz, Director of State
and Federal Relations and Special Counsel to the Governor of
Alaska, accompanied by Thomas Koester, Assistant Attorney Gen-
eral from the Alaska Department of Law.

Senator Murkowski. Mr. Chairman, I would like the record to
note that Senator Stevens will have a statement for the record, and
I would appreciate it if you would accommodate that. ^

The Chairman. Yes, we will hold the record open for him.

Senator Murkowski. Thank you, Mr. Chairman.

The Chairman. Gentlemen, if you could summarize. We have an-
other five witnesses and a panel after you, and I personally have
got about 25 minutes to deal with this. And so if you would please
proceed.

STATEMENT OF JOHN W. KATZ, DIRECTOR OF STATE/FEDERAL
RELATIONS AND SPECIAL COUNSEL TO GOV. STEVE COWPER,
STATE OF ALASKA; ACCOMPANIED BY G. THOMAS KOESTER,
ASSISTANT ATTORNEY GENERAL, STATE OF ALASKA

Mr. Katz. Mr. Chairman, for the record my name is John Katz. I
am Director of State/ Federal Relations and Special Counsel to the
Governor.

With me today is Tom Koester of the Alaskan Department of
Law. We will briefly summarize our written testimony.

The state is strongly opposed to the enactment of S. 735. We are
joined in this opposition by 15 of the 16 members of the Western
Governors Association, by the National Association of Counties, by
the Water Resources Association, and by several conservation
groups.

We believe that the Alaska Statehood Act represents a solemn
compact between the federal government and the state of Alaska.
Section 35 of the Mineral Leasing Act is part of that compact.

Pursuant to that compact, the state is entitled to 90 percent of
the federal share of revenues derived from mineral leasing. We be-
lieve that the Statehood Act is a binding contract between the fed-

' Senator Stevens' statement appears on page 8.

eral government and the state, and that it can be altered only with
the consent of the state and of the federal government.

The legislative history of the Alaska Statehood Act demonstrates
that section 35 and the mineral leasing formula contained therein
was viewed by the Congress as a fundamental and integral part of
the Alaska Statehood Act.

There is a popular misconception that Alaska receives 90 percent
of mineral revenues, whereas other states receive only 50. In fact,
that is not the case. The Congress made a conscious decision during
the Statehood Act debates not to include the state of Alaska in the
reclamation formula, and since we are not entitled to the 40 per-
cent that would have been represented by our inclusion in the
many millions of dollars that would have flowed from our inclusion
in the fund — that decision we think was premised on sound
grounds.

The fund just would not operate very well in Alaska. It is more
adapted to this arid and semi-arid West, where large irrigation and
impoundment projects make sense. Our short growing seasons and
harsh climate and topography indicate that agriculture on that
widespread basis would not be viable in Alaska.

The legislation pending before you would amend the Reclamation
Act by eliminating funding in the reclamation fund. Instead, funds
would be divided equally between the states and the federal gov-
ernment.

Similarly, it would amend the Wildlife Refuge Sharing Act by
eliminating the 25 percent that now goes to counties from mineral
development within refuges, and would alter the share that goes to
the federal government.

We believe that these amendments would create a pernicious
precedent; that there has been an understanding and a compromise
between the states and the federal government with respect to land
located within their boundaries, and in recognition of the fact that
that land, that federal land, is not subject to state control or tax-
ation, these revenue sharing formulas have been enacted into law.

The state of Alaska we think represents the most compelling in-
stance of a compact between the federal government and the state.
If our revenue sharing formulas can be amended in the way pro-
posed by S. 735, then we believe we are embarked on a slippery
slope where there may be no bottom.

Despite the fact that the legislation appears neutral on its face,
there is no question in our minds that it targets Alaska for special
treatment. The unique combination of Alaskan geology, federal
law, and federal policy indicates to us that, with the possible excep-
tion of the Delta Refuge in Louisiana, there will probably not be
very much future leasing within refuge except possibly in Alaska
in general and with respect to ANWR in particular.

This legislation would hit the state at a particularly critical time
in our history. We continue to suffer from an embryonic infrastruc-
ture. In fact, our road mileage is less than northern Virginia.

We suffer from some of the worst housing under the American
flag. At the present time, we are in the throes of a recession cre-
ated by reduced oil prices. As a consequence, there have been mas-
sive mortgage foreclosures, unemployment, and a cutback of state
services.

We support the worthy goals of the Land and Water Conserva-
tion Fund and our testimony should not be construed to the con-
trary. But even a cursory examination of the fund indicates that
the problem is not with income. In fact, receipts from designated
sources such as OCS leasing and other sources are several times
more than the authorized limitation of $900 million that Congress
has provided.

In fact, the problem is not at the income stage, but at the appro-
priations stage. There, our research indicates that only once has
Congress appropriated even at the two-thirds level of $900 million,
and in six out of the last ten years the appropriations have been
significantly less than half of the authorized limit.

We think that the $160 million that would be earmarked in S.
735 still does not solve the problem of authorization and appropria-
tion. We believe that there is a direct relationship between this leg-
islation and the Arctic National Wildlife Refuge.

The Cooper Administration strongly supports opening ANWR to
oil and gas development, subject to reasonable regulation. But we
believe that there are compelling reasons for affirming that deci-
sion and the legislation of this type, which would indirectly affect
the decision, is not necessary.

We do not intend to turn this hearing into a hearing on the
Arctic National Wildlife Refuge, but it is worth noting our increas-
ing dependence on foreign sources of crude oil, the fact that Prud-
hoe Bay will begin to decline precipitously in the near future, and
that respectable geologists feel that the Arctic National Wildlife
Refuge represents the last — the most promising unexplored petrole-
um province in North America.

Mr. Chairman, for these reasons we respectfully urge you to take
no further action on S. 735. If you feel compelled to do so, we feel
that at a minimum this legislation should be considered within the
context of a comprehensive re-examination of the Land and Water
Conservation Fund.

Thank you.

[The prepared statement of Mr. Katz follows:]

TESTIMONY OF JOHN W. KATZ
BEFORE THE SENATE SUBCOMMITTEE ON
PUBLIC LANDS, NATIONAL PARKS AND FORESTS
July 14, 1987

Mr. Chairman and members of the Subcommittee:

My name is John W. Katz. I am Director of State/Federal
Relations and Special Counsel to Governor Steve Cowper of
Alaska. With me today is Tom Koester of the Alaska Attorney
General's office.

I will present an overview of the State's concerns with
respect to S.735, and Mr. Koester will describe the legal
underpinnings of our position. We appreciate this
opportunity to explain the views of the State on this
legislation.

The State must oppose the enactment of S.735 on legal and
policy grounds.

In our opinion, such enactment would violate the solemn
compact between the United States and the State of Alaska
which is embodied in the Alaska Statehood Act. The Act
incorporates Section 35 of the Mineral Leasing Act of 1920.
As a consequence, the State is entitled to 90% of the
governmental share of bonuses, rentals, and royalties
derived from the leasing of certain Federal public lands
within the State.

We view the Statehood Act as a binding contract which was
entered into knowingly and voluntarily by the people of
Alaska and by the Federal government through Congressional
enactment. This contract can only be altered by the consent
of both parties. It is also worth noting that the
legislative history of the Statehood Act demonstrates the
intent of Congress to adopt special revenue sharing formulae
in Alaska in recognition of the large amount of Federal land
located there and the lack of infrastructure and other
needed development.

Another principal reason for Congress's decision to provide
Alaska with a larger revenue share than that which pertains
to other western states was the concomitant decision to deny
Alaska access to the Federal Reclamation Fund. In essence,
the fund gives reclamation states an additional 40% of the
proceeds derived from oil and gas leasing. The fund is
primarily utilized in the arid and semi-arid West for
irrigation and the construction of impoundment projects.

Alaska's topography, harsh climate, short growing seasons,
etc. led Congress to conclude that the Reclamation Fund
should not become operative in the State. As a consequence,
we have been denied many millions of dollars which would
represent the State's share of mineral revenues that were
included in the fund for subsequent allocation to other
western states.

Fui. Liici. , it is imporUaiiL ..^ ..^L<, ^I.w_ T....
amends the Reclamation Act of 1902 and thereby reduces the
western states' share of revenues. Funds which would have
been credited to the Reclamation Fund under existing law
would be deposited in the Land and Water Conservation Fund
and miscellaneous receipts of the Treasury under S.735.
Similarly, S.735 amends the Refuge Revenue Sharing Act.
Funds which would be divided between the county where the
Refuge is located and the Federal government under current
law would be divided between the states and the Federal
government under S,735.

Although S.735 could affect other states and local
governments, we believe that the bill targets Alaska for
especially harsh treatment. This legislation purportedly
would apply to any mineral leasing which occurs after the
date of enactment within a National Wildlife Refuge. With
the exception of the Delta Refuge in Louisiana, only the
Arctic National Wildlife Refuge and perhaps other refuges in
Alaska present any realistic likelihood of leasing within
the foreseeable future. In other states, a combination of
Federal law, policy, geology, and subsurface ownership
greatly limits the prospect of the generation of significant
Federal revenues from S.735.

Mineral revenue sharing formulae provided by the Federal
government to the western states represent a very conscious
decision to compensate these states and local governments
for the existence of Federal lands over which they have
little control and no taxing authority. S.735's amendment
of the Reclamation Act, Mineral Leasing Act of 1920, the
Refuge Revenue Sharing Act, and the Alaska Statehood Act
establishes a precedent for future actions which would have
greater monetary impacts on states and local governments.
This precedent is particularly troubling because in many
ways, Alaska's case for retention of its entitlement under
the Statehood Act is more compelling from a legal and policy
point of view than the arguments which could be mounted by
other states. Therefore, S.735 could well mark the
beginning of a slippery slope which could cause a
deficit-conscious Congress to enact future legislation
adversely affecting other revenue sharing formulae.

Mr. Chairman, we strongly support the purposes of the Land
and Water Conservation Fund. Clearly, the fund fosters
habitat protection and land acquisition, where appropriate,
on Federal lands. However, our research indicates that the
fund does not suffer from lack of sufficient revenue sources
to achieve these purposes.

As you know. Congress has previously authorized the annual
expenditure of $900 million from the fund. Yet, the amount
of revenue flowing into the fund from sources previously
designated by Congress exceeds this ceiling by a significant
margin. Moreover, the Federal government has never spent
more than two-thirds of the authorized amount, and in six of
the last 10 years, the annual expenditure has been
considerably less than half.

Thus, if the fimd has not completely met its laudable
objectives, the problem does not appear to be with the
availability of sufficient revenues. Rather, the difficulty
is with Congressional allocations at the other end of the
funding process. If this is true, we are at a loss to
understand why the iinauLmenil ul S.735 is necessary,
particularly in view of the considerations referred to
previously.

Enactment of S.735 would come at a particularly difficult
time in Alaska's history. The State still suffers from the

lack of v'C- ^ '^'^■"0^ oped infrast'^'-"'t""'^'* =nH ot-Vio>- ->^.>f-/" -

economic problems. With the marked reduction in the world
price of oil upon which Alaska is so dependent, our people
are experiencing severely depressed economic conditions,
including high unemployment, widespread mortgage
foreclosures, and significant cutbacks in State services.
While Alaska's leaders are doing their best to diversify the
State's economy and to take other necessary measures, it may
be years, if ever, before the State fully recovers. In
these circumstances, to reduce possible revenues in the
manner suggested by S.735 would represent an especially hard
blow.

The Cowper Administration strongly supports oil and gas
development in the coastal plain of the Arctic National
Wildlife Refuge (ANWR) , subject to appropriate environmental
stipulations. We recognize that S.735, by altering existing
revenue streams , might generate some additional support for
opening ANWR. We believe, however, that there are many
compelling reasons for authorizing such development without
resorting to the indirect means contained in S.735. These
reasons include the need to find new domestic oil sources at
a time of rapidly decreasing production, to reduce our
negative balance of trade, to enhance National security, and
to create additional sources of revenue and jobs in Alaska
and throughout the Nation.

Mr. Chairman, for the reasons outlined here, we respectfully
urge the committee to forego any further action on S.735.
Thank you for your consideration of our position.

The Chairman. Thank you, Mr. Katz.

I might say that we do not regard, at least I do not regard, this
as taking anything from Alaska, because drilling on ANWR is not
now permitted and it will be permitted only under such terms and
conditions, if ever, as the Congress specifies.

And you know what all the arguments are and I will not repeat
them here. But other states do have a 50-50 share, and that is the
basis of the 50-50 here.

Is there anything further?

STATEMENT OF G. THOMAS KOESTER, ASSISTANT ATTORNEY
GENERAL, STATE OF ALASKA

Mr. KoESTER. Just a few brief comments, if I might, Mr. Chair-
man.

My name is Tom Koester, Assistant Attorney General from the
State of Alaska. Mr. Katz alluded to the fact that Alaska views the
90 percent entitlement from federal lands in Alaska under the
Mineral Leasing Act as an element of the statehood compact.

And as the chair undoubtedly knows, the Supreme Court has
characterized the provisions of the Statehood Act in terms of a
compact as "an unalterable condition of the admission, obligatory
upon the United States."

So as Senator Murkowski said, if it is indeed a provision of the
statehood compact, it cannot be amended without the concurrence
of the State of Alaska.

The legislative history of the Alaska Statehood Act makes clear
that indeed Congress considered at great length the 90 percent en-
titlement.

The Chairman. I have read that statement.

Mr. Koester. Perhaps the most significant comment was one
that was made on the floor of the Senate, in which Senator Butler
of Maryland stated — he reminded his Senate colleagues that grants
in the statehood act are irrevocable and cannot be changed by a
subsequent Congress, and he said:

A bill which grants statehood is not some minor piece of legislation, but it is a
major function of the national legislature. We cannot undertake to perform that
function without reminding ourselves that we are asked to make a grant which
cannot be revoked.

We cannot, therefore, consider these bills as we would ordinary legislation, in the
sense that ordinary legislation may be amended or changed in subsequent years as
experience dictates.

But I would simply remind the Committee that Alaska does view
this 90 percent entitlement as an element of the statehood com-
pact. It was characterized by one Congressional Committee as a
"major provision" of the Alaska Statehood Act.

We would urge the Committee to keep in mind that a modifica-
tion of that formula with respect to federal public lands in Alaska
would have no effect without Alaska's concurrence.

Congress' inclusion of that formula was merely a reflection of
the understanding and the historic compromise that was made in
the 1920 Mineral Leasing Act, whereby the traditional policy of the
federal government to dispose of lands to encourage western migra-
tion, settlement, and development was changed to one of retaining

title in the federal government, but dedicating 90 percent of the
economic benefits from those lands to the states.

So it is more than just for Alaska. It is an element of the state-
hood compact, but it is also a much broader public policy that has
guided more than 60 years of federal land management.

We would urge Congress to be very cautious in changing that
historic compact.

[The prepared statement of Mr. Koester follows:]

TESTIMONY OF G. THOMAS KOESTER
BEFORE THE SENATE SUBCOMMITTEE ON
PUBLIC LANDS, NATIONAL PARKS AND FORESTS
July Ih, 1987

Thank you, Mr. Chairman.

My name is G. Thomas Koester. I am an Assistant Attorney General
for the State of Alaska.

The State of Alaska opposes S.735 on both legal and policy
grounds. As a legal matter, we view S.735 as an impermissible
attempt to amend a major component of the statehood compact under
which Alaska was admitted to the Union. As a matter of policy,
S.735 would abrogate the historic compromise in public land law
under which the United States changed its policy of disposing of
federally owned lands to one of retaining title but dedicating
the proceeds of those lands to the states in which the lands are
located.

Section 35 of the Mineral Leasing Act of 1920, 30 U.S.C. § 191,
currently governs the distribution of revenues from oil and gas
leasing of federal public domain lands. Under that statute, 90
percent of those revenues are dedicated to the benefit of the
states in which the lands are located. In the lower 48 states,
this dedication takes the form of a direct grant of 50 percent of
the revenues and deposit of an additional AO percent in the
Reclamation Fund, established under the Reclamation Act of 1902,
43 U.S.C. §§ 372 et seq. Because Alaska is not covered by the
Reclamation Act, Alaska receives the full 90 percent under the
statute.

This dedication of federal oil and gas revenues to the states
represented a historic compromise in the history of public land
law. Around the turn of the century, there was a major change in
federal land policy. The traditional practice of federal land
disposal to encourage development and western migration was
abandoned, and a new policy of federal land retention was
instituted. To compensate the states for this continued federal
ownership, which in many cases precludes economic development and
in all cases precludes state and local taxation. Congress
dedicated 90 percent of the mineral leasing revenues from those
lands to the states.

During Congressional consideration of statehood for Alaska,
considerable attention was given to the distribution of mineral
leasing revenues from federal lands in Alaska. The result of
those lengthy deliberations was that the revenue distribution
provisions of the Mineral Leasing Act of 1920 were expressly
incorporated into the Alaska Statehood Act.

The provisions of a statehood act admitting a new state to the
Union constitute a compact -- a legally enforceable contract --
between the citizens of the new state and the United States.
Such a compact does not impose obligations only on one of the
parties; instead, obligations are imposed on both the new state
and the United States. The specific terms of such a compact are
obligatory and subsequently cannot be unilaterally amended by
either party. As the United States Supreme Court once noted with
respect to the Act admitting Wisconsin to the Union, a statehood
act provision is "an unalterable condition of the admission,
obligatory upon the United States." Beecher v. Wetherby , 95 U.S.
(5 Otto) 517, (1877).

Congress incorporated the Mineral Leasing Act of 1920 into the
compact under which Alaska was admitted to the Union in section
28(b) of the Alaska Statehood Act. In part, this undoubtedly was
no more than Congressional recognition of the long-standing
policy, applicable to virtually all of the western states, of
dedicating 90 percent of the proceeds of public lands to the

states in which the lands are located -- i.e. , the historic
compromise adopted in 1920.

At the same time, however, the legislative history of the Alaska
Statehood Act makes clear that Congressional incorporation of the
Mineral Leasing Act in the statehood compact also was Congress'
way of partially compensating Alaska for the substantial amount
of federal land which had been withdrawn and reserved by the
federal government for various purposes , and the attendant loss
of economic productivity caused by those withdrawals and
reservation. Ironically, a number of those withdrawals and
reservations were for wildlife refuges, the specific federal
lands for which S.735 seeks to change the revenue distribution
formula.

To fully appreciate Congress' incorporation of the Mineral
Leasing Act's 90 percent entitlement for Alaska in the statehood
compact under which Alaska was admitted, one must look at the
facts confronted by Congress at that time. A significant concern
during the deliberations on Alaska statehood was whether the
Alaska economy was sufficient to support a new state and the
essential government services which the new state would have to
provide. Much of that concern was a result of the fact that more
than 99 percent of all the land in Alaska was owned by the feder-
al government. Little or no development had taken place because
of federal land management practices, and federal land therefore
was not contributing to the economic development of the terri-
tory. In addition, because it was federally owned, it would be
exempt from any taxes which might be levied by a new state
government.

To ensure that the new State of Alaska would have sufficient
economic resources to meet the necessary expenses of state
government. Congress included a substantial land grant in the
Alaska Statehood Act. In doing so, however. Congress discovered
that more than one-fourth of the land in Alaska -- more than 95
million acres -- was included in federal withdrawals and
reservations, several of which were wildlife refuges. Those
withdrawn and reserved lands appeared to include most of the
valuable resources in Alaska.

As a partial remedy to this situation, which one committee report
characterized as "the problem of federal reservations," Congress
consciously granted Alaska 90 percent of the oil and gas leasing
revenues from federal lands in Alaska. Characterizing this as
one of the "major provisions" of the Alaska Statehood Act,
Congress concluded that this would minimize the adverse impact of
federal withdrawals on the new state's economic viability and
would ensure that the new state would benefit from any develop-
ment of the substantial resources which might be found within
those federal withdrawals.

Attached to the printed text of my testimony are a number of
excerpts from the legislative history of the Alaska Statehood Act
which demonstrate that both supporters and opponents of Alaska
Statehood were well aware that Congress was including, as part of
Alaska's statehood compact, an entitlement to 90 percent of all
oil and gas lease revenues from federal lands in Alaska in
perpetuity. VThile it would serve no purpose to go over all of
them in detail, a few examples illustrate the broader Con-
gressional understanding.

Senator Barrett of Wyoming, a supporter of statehood for Alaska,
authored the language of what became section 28(b) of the Alaska
Statehood Act, the section that incorporates the Mineral Leasing
Act into the statehood compact. During a Senate hearing on
statehood for Alaska, he remarked: "So I think it would be
eminently fair and just and right and proper, when we write
this bill up, that we . . . let the Federal Government retain
the title to the minerals except such public lands as are granted
to you, but give the Territory now and the State of Alaska-to-be
ninety percent of the income from the minerals under the Leasing
Act royalties that come in from now on out." Later in the

- 2 -

hearing, he introduced the language that now appears as section
28(b) of the Alaska Statehood Act with the words: "I propose to
insert a new section 21 on the last page of the bill and provide
in here that 90 percent of the income from coal and 90 percent of
the income from the leasing act minerals shall go to the new
State of Alaska." He noted that the Secretary of Interior had
suggested such a provision be included in the statehood bill.

Representative Dawson of Utah, also a supporter of statehood for
Alaska, commented on the House floor that "[t]hese [revenue
sharing] provisions are the foundation upon which Alaska can and
will build to the enormous benefit of the national economy shared
by her sister States."

Senator Talmadge of Georgia, an opponent of statehood, noted
during the Senate floor debate that the Statehood Act land grant
and the various revenue sharing measures, specifically including
the entitlement to 90 percent of oil and gas leasing revenues,
"have been referred to variously as a 'dowry' and 'the greatest
giveaway of natural resources in the history of this country.'"

Finally, and perhaps most significantly. Senator Butler of
Maryland, a statehood opponent, reminded his Senate colleagues
that grants made in statehood legislation are irrevocable and
cannot be changed by a subsequent Congress:

A bill which grants statehood is not some minor
piece of legislation, but is a major function of
the national legislature. We cannot undertake to
perform that function without reminding ourselves
that we are asked to make a grant which cannot be
revoked. We cannot, therefore, consider these
bills as we would ordinary legislation in the
sense that ordinary legislation may be amended or
changed in subsequent years as experience
dictates .

When placed in its proper historical perspective, it is not
surprising that Congress included an entitlement to 90 percent of
the proceeds from federal oil and gas leasing in the Alaska
Statehood Act. The Mineral Leasing Act, and its revenue
distribution formula under which 90 percent of the revenues from
federal lands are dedicated to the states in which the lands are
located, represents a historic trade-off in the development of
public land law. In enacting it. Congress terminated its tradi-
tional policy of disposing of the public lands. Instead, it
determined that the federal government should retain those public
lands, but should dedicate most of the mineral revenues from
those lands to the benefit of the states in which the lands are
located.

Virtually all of the public land states were admitted to the
Union prior to the enactment of the Mineral Leasing Act, and its
dedication of 90 percent of public land revenues to the states,
in 1920. As a result, the statehood acts admitting those states
do not include a provision similar to the one incorporated in the
Alaska Statehood Act. However, incorporation of the Mineral
Leasing Act in the Alaska Statehood Act simply reflects the Con-
gressional understanding that the Mineral Leasing Act indeed was
a historic compromise and, as a result of that compromise, the
public land states are to receive the benefit of 90 percent of
the revenues from federal lands within their borders in return
for the continued federal ownership and management of those
lands .

Passage of this bill would significantly alter one of the
carefully considered terras and conditions under which Alaska was
admitted to the Union. It would be an impermissible unilateral
attempt to amend the solemn compact between the national
government and the citizens of Alaska. Alaska has not agreed to
this modification of the compact between Alaska and the United

77-689 - 87 - 3

States and, without such agreement, it would have no force or
effect.

It also would signal a marked departure from the historic
compromise, under which Congress dedicated 90 percent of the
proceeds of the public lands to the states in return for
continued federal ownership, which has guided federal public land
policy throughout the United States for more than six decades.

Alaska supports the goals of the Land and Water Conservation
Fund. At the same time, the state is concerned that these
goals not be accomplished at the cost of a fundamental change in
the provisions of the solemn compact under which Alaska entered
the Union and the historic compromise which has guided federal
public land policy for more than two generations.

Thank you very much for the opportunity to testify on this bill.
We hope that we can work constructively with this subcommittee
and the Congress to improve the effectiveness of the Land and
Water Conservation Fund without sacrificing Alaska's statehood
birthright and more than sixty years of federal public land
policy. Again, thank you very much.

ALASKA STATEHOOD ACT LEGISLATIVE HISTORY:

CONGRESSIONAL INCORPORATION OF MINERAL LEASING

ACT 90% REVENUE SHARING FORMULA IN

ALASKA STATEHOOD COMPACT

1. During Senate hearings on Alaska Statehood, one
senator explained that he thought the new State of Alaska should
get all of the lands within its boundaries but, because that
probably was not possible, the Statehood Act should include a
grant of 90 percent of Mineral Leasing Act revenues "from now on
out."

Senator BARRETT. ...

So I think it would be eminently fair and
just and right and proper, when we write this bill
up, that we provide here that the [Mineral]
Leasing Act of 1920, as amended, and let them
retain title to the lands up there, except that
which is granted -- personally I hate to see that
done, but to be realistic we probably have to do
that -- let the Federal Government retain the
title to the minerals except such public lands as
are granted to you, but give the Territory now and
the State of Alaska-to-be ninety percent of the
income from the minerals under the Leasing Act
royalties that come in from now on out.

Hearings on S. 49 and S. 35 before the Senate Committee on Inte-
rior and Insular Affairs, 85th Cong., 1st Sess. 30-31 (1957).

2 . Later in those hearings , the same senator offered
an amendment to the proposed statehood legislation under consid-
eration which would provide that "90 percent of the income from
the leasing act minerals shall go to the new State of Alaska,"
noting that the Secretary of Interior supported a bill under con-
sideration in the House of Representatives which would do pre-
cisely that but "suggested that the statehood bill was the proper
place to insert such a provision." The language of the proposed
amendment is identical to the language of what ultimately was
enacted as section 28(b) of the Alaska Statehood Act. Both the
author of the proposed amendment and one of his colleagues hoped
that giving Alaska a 90 percent entitlement might ultimately
result in their states getting the same thing. Whether that
would result or not, however, they agreed that Alaska should
receive such an entitlement as part of its statehood act.

Senator ANDERSON. ... As far as I am con-
cerned, I hope you [Alaska's non-voting Delgate
Bartlett] would agree with me that what we tried
to do was to make it possible for Alaska to come

in as a State and live self-respectingly among the
States.

We did not strip her of every dollar she
could get, but tried to give her all the money to
make Alaska a good and fine progressive State. I
believe the bill does that.

Senator BARRETT. ... I am offering an
amendment here for the consideration of the
committee. I think this is probably as good a
time as any to do it.

I discussed this amendment this morning when
you were absent, Senator Anderson, I propose to
insert a new section 21 on the last page of the
bill and provide in here that 90 percent of the
income from coal and 90 percent of the income from
the leasing act minerals shall go to the new State
of Alaska.

When I mentioned that this morning. Delegate
Bartlett told me that the House committee had con-
sidered a' bill doing precisely that and had
reported it out favorably. Since then I have
looked up the record and I find that the Secretary
of the Interior has filed a favorable report on
the bill and agreed that it should be enacted into
law but suggested that the statehood bill was the
proper place to insert such a provision.

Maybe it would be well to have in these
hearings a copy of the report that the Secretary
of the Interior made on the House bill.

Senator JACKSON. Without objection, the
report and the amendment of the Senator from
Wyoming will be included in the record at this
point, if that is agreeable. The report and the
amendment should go together.

(The documents referred to are as follows:)

BARRETT AMENDMENT TO S. 49

Sec. 22. . . .

(b) Section 35 of the Act entitled "An Act
to promote the mining of coal, phosphate, oil, oil
shale, gas, and sodium on the public domain,"
approved February 25, 1920, as amended (30 U.S.C.
191) is hereby amended by inserting immediately
before the colon preceding the first proviso
thereof the following: ",and of those from Alaska
52 1/2 per centum thereof shall be paid to the
State of Alaska for disposition by the legislature
thereof".

[Secretary of Interior's Report]

DEAR MR. ENGLE [Chairman of the House Commit-
tee on Interior and Insular Affairs]: This is in
reply to your request for the views of this
Department on H. R. 3477, a bill relating to
moneys received from mineral lands in Alaska.

We recommend that H. R. 3477 be enacted. We
believe, however, that the subject matter of the
bill would be more appropriately covered in state-
hood legislation.

Senator ANDERSON. Do you not think Senator
Barrett, that supplements the statement I made,
that whatever makes it possible for the State to
exist is a good bill?

I think Senator Barrett should be conmended
for that proposal. I thing there are some other
States that the proposal could be applicable to
but we may get our rights some time if Alaska
does.

Senator JACKSON. That may be a good prece-
dent for the other 11 Western States.

Senator ANDERSON. It happens that Wyoming
and New Mexico are the 2 principal contributors to
the Federal Treasury on this particular section,
$100 million in Wyoming and $130 million or $140
million in New Mexico which we could have used
very nicely in our State.

Senator JACKSON, We may have some problems
with the other 37 States on this issue.

Senator BARRETT. I do not think so, particu-
larly. I think we would be remiss a bit if we did
not include it here, particularly since the Bureau
of the Budget and the Secretary of the Interior
and everyone interested has approved this.

Hearings on S. 49 and S. 35 before the Senate Interior and
Insular Affairs Committee, 85th Cong., 1st Sess. 66-67 (1957).

3. A House committee report, in a section entitled
"The Problem of Federal Reservations," noted that a partial solu-
tion to the depressing effect of federal withdrawals on the eco-
nomic viability of a new Alaska state government would be to
specify that the act of admission would grant Alaska 52 1/2 per-
cent of Mineral Leasing Act revenues. This would be in addition
to the 37 1/2 percent that all other public land states receive
because, while those states were covered by the Reclamation Act,
Alaska would not be.

As previously noted, tremendous acreages of
land in Alaska have been tied up in the status of
Federal reservations and withdrawals for various
purposes. The committee feels strongly that this
practice has been carried to extreme lengths in
Alaska, to a point which has hampered the develop-
ment of such resources for the benefit of mankind.
As a result, a long list of potential basic indus-
tries in the territory, including the forest
industry, hydroelectric power, oil and gas, coal,
various other minerals, and the tourist industry,
can exist in Alaska only as tenants of the Federal
Government , and on the sufferance of the various
Federal agencies. The committee considers that to
be an unhealthy situation.

The failure of these industries to grow under
such a restrictive policy is a proof of its
unwisdom. The committee feels that this policy
must be changed if statehood for Alaska is to be a
success.

In its approach to the statehood issue, the
committee has attempted to make a start toward
such a change by various specific provisions in
the bill. . . .

A second provision in section 28 amends the
Mineral Leasing Act of 1920, as amended, by grant-
ing 52 1/2 percent per annum of the net proceeds
realized from coal, phosphates, oil, oil shale,
and sodium on the public domain in Alaska shall be
paid to the State of Alaska for disposition by the
legislature thereof.

The payment of these proceeds is recommended
in return for Alaska not being covered by the Rec-
lamation Act of 1902, as amended. The Reclamation
Act provides that in the 17 Western States 52 1/2
percent of the oil- and gas-lease revenues goes
into the reclamation fund; 37 1/2 percent is re-
turned to the respective States , and the remaining
10 percent is retained by the Federal Government
for administration purposes.

H.R. Rep. No. 624, 85th Cong., 1st Sess. 7-8 (1957).

4, The same point is reiterated in the sectional

analysis,

Subsection [28] (b) amends the act to promote
the mining of coal, phosphate, oil, oil shale,
gas, and sodium on the public domain approved Feb-
ruary 25, 1920, by providing that 52 1/2 percent
of the proceeds received therefrom shall be
covered into the State treasury for disposition by
the State legislature.

The payment of these proceeds is recommended
in return for Alaska not being covered by the Rec-
lamation Act of 1902, as amended. The Reclamation
Act provides that 52 1/2 percent of the oil and
gas revenues goes into the reclamation fund; 37
1/2 percent is returned to the respective States
and the remaining 10 percent is retained by the
Federal Government for administration purposes.

Id. at 23.

5. A Senate Report made Alaska's entitlement to 90
percent of federal oil and gas leasing revenues even clearer.

Some of the additional costs connected with
statehood will be met by granting the State a rea-
sonable return from Federal exploitation of

- 5 -

resources within the new State. In the past the
United States has controlled the lion[']s share of
such resources and, in some instances, retained
the lion's share of the proceeds. This situation,
though it has not proved conducive to development
of the Alaskan economy, may have been proper at
times when the United States paid a large part of
the expense of governing the Territory. However,
the committee deems it only fair that when the
State relieves the United States of most of its
expense burden, the State should receive a realis-
tic portion of the proceeds from resources within
its borders. The divisions of proceeds estab-
lished in the bill are determined by comparisons
with other States and consideration of the geo-
graphic facts which apply to Alaska.

Section 22 of the bill extends to the State
the provisions of Public Law 88, 85th Congress,
which was approved July 10 of this year. Under
this new law the Territory receives a total of 90
percent of the profits from government coal mines
and 90 percent of the profits from operations
under the Mineral Leasing Act. Prior to the 1957
law, Alaska received none of the proceeds from
government coal mines and 37 1/2 percent of the
proceeds from mineral leasing operations. Without
section 22 in the bill, the new State would not be
within the purview of the 1957 act.

S. Rep. 1163, 85th Cong., 1st Sess. 3 (1957).

6. During the floor debate on Alaska statehood in the
House of Representatives, one congressman outlined the relation-
ship between the extensive federal withdrawals and the entitle-
ment to 90 percent of all mineral leasing revenues which, in
addition to the land grant, would form the "foundation" of
Alaska's entry into the Union.

Mr. DAWSON of Utah. . . .

Further, over 92-million acres -- both in and
out of the defense area -- already have been with-
drawn by the Federal Government, and these include
much of the most valuable resources. They in-
clude, for example, nearly 21 -million acres of the

best forest lands and nearly 49-million acres of
oil and gas reserves.

As to that lion's share of lands which would
remain under Federal control, Alaska would receive
-- for the support of its public schools -- 5 per-
cent of the net proceeds from the sale of any land
by the Federal Government.

Additionally, Alaska would receive 90 percent
of the proceeds from the operation of Government
coal mines and from the production of coal, phos-
phates, oil, oil shale, and sodium from the public
domain. Reflecting Alaska's exclusion from the
Reclamatioin Act of 1902, these are the same pro-
visions which this Congress approved -- by consent
-- for the Territory of Alaska last year in Public
Law 85-88.

These provisions are the foundation upon
which Alaska can and will build to the enormous
benefit of. the national economy shared by her
sister States. We cannot make Alaska a "full and
equal" State in name and then deny her the where-
withal to realize that status in fact.

85 Cong. Rec. 9360-9361 (1958).

7 . During the floor debate in the Senate , an opponent
of statehood for Alaska argued that the sharing of mineral reve-
nues with the new State of Alaska, as a means to "alleviate" the
adverse effect of continued federal control of significant acre-
age and resources, would result in Alaska being too dependent on
those federal revenues.

Mr. ROBERTSON. . . .

The uniqueness of the Alaska land situation
is further emphasized in the committee report,
which points out that on the occasion of admission
of existing States land grants amounted to a maxi-
mum of 6 to 11 percent of the total land area, and
much acreage already had passed into private
taxpaying ownership, whereas in Alaska, even after

a grant of unprecedented propotions to the pro-
posed State, the Federal Government would continue
to control more than two-thirds of the total acre-
age and an even larger percentage of the
resources.

To alleviate this situation to some extent,
the bill proposes to share with the State profits
from Government coal mines, mineral leases, and
the fur monopoly, which, of course, would make the
State government a pensioner dependent on the
Central Government to a much greater extent than
the existing States which already, in my opinion,
have jeopardized their constitutional rights by
too ready acceptance of Federal handouts for a
variety of public works and welfare programs.

85 Cong. Rec. 12020 (1958).

8. A supporter of Alaska statehood introduced a De-
partment of Interior memorandum outlining the "new sources of
revenue available to Alaska," one of which was listed as "oil and
gas leases (90 percent to the State)." Another supporter then
pointed out that oil had just been discovered in Alaska, and that
discovery "will have a tremendous impact on the ability of the
new State to provide the essential resources to support itself."

Mr. CHURCH. . . .

Mr. President, I wonder if the Senator from
Florida will permit me to offer at this point in
his address a memorandum which I have received
from the Department of the Interior, which is
directed to the very subject on which the Senator
is now elaborating, namely, the capacity of Alaska
to support statehood.

We have heard in the course of this debate
many exaggerated statements about how statehood
would impose an impossible burden upon the
undeveloped economy of Alaska. If one were to
listen uncritically to such statements, one might
be led to conclude that statehood would drive the
Alaskan economy into insolvency and bring ruin
upon the people there.

I think this memorandum effectively gives a
rebuttal to that argument, in that it shows

- 8 -

precisely what the additional costs for statehood
would be, and what the additional income to the
newly formed State government would be, by virtue
of the provisions contained in the pending bill.

The PRESIDING OFFICER. Without objection,
the memorandum referred to by the Senator from
Idaho will be printed in the Record.

The memorandum is as follows:

New Revenues Available to Alaska

Oil and gas leases (90 percent

to the State) $3,000,000

Mr. JACKSON. . . .

I should like to point out one further con-
sideration' in connection with the financial abili-
ty of the proposed new State to take care of its
responsibilities. Just 11 months ago we witnessed
the first oil strike of any substance in Alaska.
A little more than a year ago about 5 million
acres were under lease, or applications were
pending with respect thereto. The most recent
check, in May, showed 32 million acres covered by
oil leases or lease applications.

The program involves all the major oil compa-
nies and numerous independent oil companies. We
have been advised in the Committee on Interior and
Insular Affairs, where some of the legislation on
this subject is handled, that the signs are most
hopeful for a tremendous oil development in the
area which will become a State.

I add that one point because it will have a
tremendous impact on the ability of the new State
to provide the essential resources to support
itself. This is a factor not indicated in the

9 -

Secretary's analysis of the ability of the new
State to do the job.

85 Cong. Rec. 12207-12208 (1958).

9. An opponent of statehood again pointed to the 90
percent entitlement in the statehood bill as evidence of the
"prevailing doubt" regarding the ability of the new state to
support itself.

Mr. TALMADGE. . . .

The prevailing doubt of Alaska's ability to
support itself is evidenced by the generous
special considerations which are made for it in
this statehood act.

In addition [to a large land grant] , it would
be granted:

Ninety percent of the profits from Government
coal mines and operations under the Mineral Leas-
ing Act, of which 37 1/2 percent of the latter
would be earmarked for roads and schools.

These considerations have been referred to
variously as a "dowry" and "the greatest giveway
of natural resources in the history of this
country."

85 Cong. Rec. 12297 (1957).

10. Finally, the permanent and irrevocable nature of the
granting of statehood was described.

Mr. BUTLER. . . .

Despite all its complex features, the primary
purpose of the bill is to grant statehood. A bill
which grants statehood is not some minor piece of
legislation, but is a major function of the
national legislature. We cannot undertake to

- 10 -

perform that function without reminding ourselves
that we are asked to make a grant which may not be
revoked. We cannot, therefore, consider these
bills as we would ordinary legislation in the
sense that ordinary legislation may be amended or
changed in subsequent years as experience
dictates. . . .

My research has also developed that there is
contained in the bill provisions which have the
effect of giving away more revenue and more prop-
erty than has ever been given to any State in its
enabling act.

85 Cong. Rec. 12316-12317 (1958).

- 11

The Chairman. We will certainly be very cautious in that, and
we will pay due regard to that question, which I was not aware of,
of your view that that is part of the condition of admittance of the
state, which can be changed only with the consent of the state of
Alaska. So we will get our legal eagles to work on that.

Gentlemen, thank you very much. I am sorry to give you such a
short period of time. You had an excellent statement which I have
read and it is very well researched, and we will pay due and proper
regard to that.

Thank you very much.

Mr. Katz. Thank you, Mr. Chairman.

The Chairman. Finally, we have a panel with: Barry Tindall, Di-
rector of Public Works of the National Recreation and Park Asso-
ciation — Director of Public Affairs, excuse me; Destry Jarvis, Vice
President of the National Park and Conservation Association; Tim
Mahoney, Washington Representative for the Sierra Club and
Chairman of the Alaska Coalition; Lonnie Williamson, Vice Presi-
dent, Wildlife Management Institute; Jack Berryman, Executive
Vice President of the International Association of Fish and Wildlife
Agencies.

Gentlemen, welcome to the Committee. This is an outstanding
panel. I hope you can quickly summarize, and I hate to give you
short shrift, but we are going to have a vote shortly and then I
have got a very high priority meeting after that to deal with what
we call our 302(b) allocations from the Budget Committee on the
Appropriations Committee, and that is really a very first priority.

So Barry Tindall, why do you not begin.

STATEMENT OF BARRY S. TINDALL, DIRECTOR OF PUBLIC
AFFAIRS, NATIONAL RECREATION AND PARK ASSOCIATION

Mr. Tindall. Mr. Chairman, we hope your 302(b) allocation is fa-
vorable to your Committee, and especially favorable to the Land
and Water Conservation Fund and its broad context.

In that regard, I believe the Budget Committee assumed a distri-
bution of about $250 million for land and water. We would hope
you would keep your eye on that particular aspect of it.

Hearing you say that in the context of this hearing gives me
pause to say what I will say, but I wish we could be supportive of
the present bill, but we in fact are not unless significant changes
are made.

The two features that we would like to just briefly call to your
attention are: first is the fact that the Land and Water Conserva-
tion Fund has from the outset been a partnership between the na-
tional government, the states, local governments, and others. If the
Congress in its wisdom decides to pursue S. 735 or some variations
thereof, we would hope and would like to work with you to assure
that in fact this partnership continues.

The second aspect that we would call to your attention is that, if
in fact again Congress in its wisdom decides to access the national
wildlife refuge system for energy extraction activities, then we
think the bulk, literally 100 percent, of any revenues that come out
of those activities ought to be reinvested in conservation and recre-
ation purposes.

That would diminish the potential for other pressures, namely
say general fiscal support to a state or nation, to drive those deci-
sions. If this Administration or any future Administration under-
stands from the outset that whatever is developed goes back into
recreation and conservation, then that may in fact cause a little
different consideration of those decisions.

Those are the two principal things that we would call to your at-
tention in the interest of time today. Thank you.

[The prepared statement of Mr. Tindall follows:]

STATEMEN"" OF NATIONAL P.ECP.EATIOK ANT PAHK ASSOCIATION OK £."^"'= BEFORE
SUBCOMy.ITTEE OK P'JBLIC LANDS. NATIONAL PARKS ANL FORESTS. TOITEI^ STATES
SENATE. JULY, 14, IPS?

Mr. Chairman, Members of the Subcommittee: I am Barry S. Tindall,
director of Public Affairs for the National Recreation and Park Association.
We appreciate the opportunity to address proposed amendments to the Land and
Water Conservation Fund Act of 1965.

The Association is a national organization of 20,000 individuals,
agencies and organizations. Our members include civic leaders and
professionals who guide, develop and manage recreation and park services and
resources, principally but not exclusively in the public sector. Our
members include people working at all levels of general government and
special districts, in the Armed Forces, in hospitals and other institutions
serving special populations, and in academic settings. We have at least one
affiliate organization in each state, and several in other countries. RRPA
members have been centrally involved in activities authorized by the Land
and Water Conservation Fund Act.

S. 735 proposes to authorize the distribution of 25 percent of the
income derived from the leasing of oil and gas resources in the Rational
Wildlife Refuge System to a special account within the Land and Water
Conservation Fund exclusively for Federal land acquisition. It does not
directly authorize energy development in the refuge system, but the
relationship is potentially close.

While there are certain features of the bill with potential merit we
cannot support enactment of the present measure. We say this reluctantly,
because its author has been in the forefront of actions to enhance
recreation through resource conservation.

Among our concerns:
o The bill assumes in large part that the present problem associated with
the Land and Water Conservation Fund includes the amount of revenue
available to it. This is not the case. Rather, since fiscal year 1965 over
$82 billion has accrued to the United States from Outer Continental Shelf
activity. OCS is now the principal LWCF source. The problem is the
nonavailability of funds, through appropriations or other means.

o The bill, perhaps indirectly, encourages activities potentially
detrimental to the type of resources proposed for protection by the Land and
Water Conservation Fund Act eind other statutes.

The bill fails to recognize that a central strength of the Land and
Water Conaervation Fund Act is its ability to develop a partnership between
the national government, the states, and others and to leverage investments
by non-federal participants. It fails further to recognize the need for new
LWCF constituencies.

Notwithstanding these objections if the Committee and Congress
determine that the legislation should pass we would strongly recommend
amendments which achieve the following:

All public receipts from activities on the National Wildlife Refuge

System should be reinvested for conservation and recreation purposes .

S.735 proposes a distribution formula which fails to fully recognize
the magnitude of conservation and recreation needs and which might encourage
local or other actions inconsistent with national conservation and
recreation goals. We propose that 100 percent of all revenues associated
with potential energy development activities be available to the Land and
Water Conservation Fund. This distribution should remain in force for a
significant time, perhaps 25 years. This approach would have the dual
impact of greater conservation and recreation investments while 'dampening'

- 2 -

extraotior. activities motivated principally by fiscal need. The natural
resources under discussion here, and the fiscal resources that might result
from their use, belong to all citizens. The return of 50 percent of
receipts to a particular state fails to recognize this principle.
o The States, and through the states, local governments, should

participate in use of all funds available from the special account .

The State/Federal distribution ratio should be 60/40 and the special

account "base" of $160 million should be increased proportionately .

Apportionment among the states should follow the existing formula .

The Land and Water Conservation ?und has, since its authorization,
functioned as a partnership between governments. The states and local
governments have proven effective and efficient partners in defining and
working toward national conservation and recreation goals. The Land and
Water Conservation Fund Act's original distribution formula was 60 percent
state and 40 percent federal. Until about 1980 appropriations generally
followed this pattern. Recently, many organizations endorsed a series of
concensus points on a potential future fund, including the 60/40
distribution formula.

Since its authorization state and local governments have invested over
$3 billion in non-federal resources to equally match congressional LWCF
appropriations. They have assumed all operational and other costs in
perpetuity. Achievements are impressive: over 34,200 acquisition and
development projects, and 2.3 million acres of land reserved for
conservation and recreation purposes. Population growth and distribution, a
continuing high demand for recreation opportunity, especially close to home,
and rapidly deminishing land conservation opportunities all reinforce the
need to strengthen this outstanding public partnership.

- 3 -

Senator Johnston's introductory statement on S.''35 noted: "...T
concede that much work remains to be done relative to these matters
(reauthorization of LWCF) but I think that this approach of putting a
variety of legislative vehicles and options before the Committee and the
Senate will serve us well."

S. 755 is one option. It contains features which, if developed more
fully, could be supported in a more comprehensive bill. It recognizes, for
example, that the gap between authorization and actual availability of funds
must be substantially closed. The proposal recognizes, too, that in excess
of $5 billion remains credited to the Land and Water Conservation Fund
treasury account. Public agencies, land owners, and the present and future
user public have every right to expect that public resources will be
available to reasonably plan, conclude agreements, and provide recreation
opportunity in a timely and efficient manner.

We look forward to working with the Congress to achieve a viable
funding program for parks and recreation. We believe that legislation which
deals with fiscal resources for parks, recreation and conservation must
ultimately recognize and embrace associated needs and conditions, among
them:

o The desirability of reinvesting some fiscal resources in a "corpus,"
which itself would ultimately provide revenue.

The need for a new public focal point in government to administer the
?und , and perform other functions to advance parks, recreation and leisure.
An entity similar to the Rational Foundation for the Arts and Humanties, and
its associated endowments should be considered.

This concludes our prepared remarks. I would be pleased to respond to
questions.

- A -

The Chairman. Thank you very much, Mr. Tindall.

I would be interested in getting your specific comments on how
you would want that formula changed, and we would like to have
those conversations, either in writing or contact us. And we would
like to have that.

Mr. Tindall. I might just add as a footnote, Mr. Chairman, that
I believe you stated at the outset of this hearing that consideration
of this bill does not preclude further, and we hope timely, consider-
ation of the Land and Water Conservation Fund and the many rec-
ommendations of the President's Commission.

The Chairman. Exactly.

Mr. Tindall. We would reinforce our belief that that should
occur and other dimensions should be looked at.

The Chairman. Yes, I would, if I have my way — and I may not
on this — I would like to pass this bill early on and just pretermit so
many of those questions about the Outdoor Commission, because it
would take a long time to do that.

We will have the time, but I would like to put this bill in place if
we can and then just forget about the fact that this bill was ever
passed as we consider ANWR. To me, the worst thing would be to
first pass ANWR and then come and then try to put this bill in
place.

You may think it is an easy thing to do, but I think it would be
just absolutely impossible. I mean, you try to get a few bucks for
an)d;hing out of that budget when you are fighting against other
priorities and it is just virtually impossible.

So if we put this bill in place, then we can come back later on at
our leisure and look at what we do with the recommendations of
the Great Outdoors Commission and the Land and Water Conser-
vation Fund and all the rest of those things.

But thank you very much for your suggestions.

[Subsequent to the hearing Mr. Tindall submitted the following:]

National Recreation and Park Association

J„1y T7 . 1 or

'''hp Honor "iblp

f^h H i rmrin

Commi-'.tnc on "^nprpy tp.'I

United Stites ^'enitp

Washi n<T»on. CC ?0510

'enn'^'-t .Tohns^on

N^'urpl Pnsources

D p ■! r r <■■ n -i 1 f J o h r s '. o n :

Wp -ipprpciatR f. he invitation riurirp thf hpnrins to follow
up with specific propospd nmpndmpnts to '^.7-'S, a bill to ampnd
the I.-ind -^nd W<>tpr Honservation Fund. Thp proposed sracndmonts
would implppipnt our two central rpcommcnd 1 1 i o ns : thnt tII
receipts from pner^y activities on refuges ^o directly to
conservation ^nd recreation purpos"S. ssnd that state 5nd lor^l
govprntr.ents share in the resulting reinvestment program.

tfp recomiend the following:

Amend page 2, lines 2-

t o read

"issupd after thp date of enactment of this title
shall he deposited in the Fund."

Amend page 2 by striking lines ^-'^.

Amend page 2. line 12 by striking ? 1 60. 000 . 000 and
inserting in lieu thereof ''■400,000.000.

Amend page

lines 1'i-l'' to read as follows:

"{2) Forty percent of the ff'lunds deposited into
the special account shall be available, without
further appropriation, for Federal purposes as
provided in Section 7 of this Act and shall be
allocated in accordance with this title. i^ix ty
percent of the funds deposited into the special
account shall be available, without further
appropriation, to t h e Htates and through the States
local governments as provided in Section 6 of this
Act."

3101 Park Center Drive • Alexandria, Virginia 22302 • 1703) 820-4940

Am.-n-^ p^f" ". line ?1 1:0 roafl r-s follows:

" Fnrt pral p o rtl on of 'f)unds from the special account
i". Tccorflinco with ♦hf" priority."

W" will, of course bo pleased to work with staff to
further to discuss our rfcomionditions.

'fyr^J^/i^-^^

Pn rry ^5 . (Mnd al 1

Director of Public Affairs

:c I'on. Dale Bumners
Hon. Malcolm Wallop

77-689 115

mzked to indicate amencJments propDsed by
National Itecreation and Park Association.

100th CONQKESS
18T Session

S.735

To uncnd the Land ind Water Ooniervmtion Fund Act of 1965, and for other

purpoaet.

IN THE SENATE OF THE UNITED STATES

Uakcb 12. 1987

Mr. Johnston introduced the following bill; which was read tviice and referred

to the Committee on Energy and Natural Besources

A BILL

To"amend the I^d and Water Conservation Fund Act of 1965,- "
and for other purposes.

1 Be it enacted by the Senate and House of Representa-

2 lives of the United States of America in Congress assembled,

3 That the Land and Water Conservation Fund Act of 1965,

4 as amended, is further amended bj adding the foDowing new

5 title:

6 "TITLE m— SPECIAL ACCOUNT

7 "Sec. 301. (a) Notwithstanding any other provision of

8 law, all revenues received from competitive bids, sales, bo-

9 nuses, royalties, rents, fees, interest charges or otiier income
10 derived from the leasing of oil and gas resources within units

1 of the 2saiionaI WlJdlife Refuse System pursuant lo leases

2 issued after the date of enactment of thi? title shall be di s irii > -

3 uted ar followt: ^POsited in the Rmd.

4 "(1) 50 per oontum to the Stutf in -B-hirh thp

5 Tpfiif'p unit IB Innnted:

6 "(?) ?5 p""" ''^"^""' "Tf'i'tpi^ into the fund: and

7 "(8) 2o por c e ntum to giisprllnnenus rfreipty in

8 t>ip TVpn'siin-.

9 "(b)(1) MonevE deposited into the fund pursuant to sub-

10 section (a) shall be credited to a special account within the

11 fund. In addition, there shall also be deposited into this spe-

$400,000,000 , , . , ,

12 cial account, !?ifinmnnnn j,pt annum to be denved from

13 those moneys comprising the authorized but unappropriated

14 balance of the fund.

15 "(2) Tunas deposited mto the special account shall be

16 available, -srithout further appropriation, for Federal purposes

17 as provided in section 7 of this Act and shall be allocated in

18 accordance vdih this title, sixty percent of the funds deposited into the special account

, , , . . r ^' Shall be available, with-

19 "Sec. 302. (a) At the tune of the submission of tne

20 President's budget, each Federal land managing agenc}- eligi-

21 ble to receive moneys from the fund shall pro\'ide the Com-

22 mittee on Appropriations of the United States House of E-ep-

23 resentatives and the United States Senate with a list, in de-

24 scending order of priority, of land acquisition projects (herein-

25 after in '.his title referred to as the 'prioritj- list').

out furthur appropriation,
to the States, and through
the States, local gav/errment
as Drovided in section 6 of
this Act: ■-•-•■••••-■■ - ■.■■■.■■-■ • ■

E 73S IS

1 "(b) The prioritT lists shall be prepared by the Directors

2 of the Bureau of Land Management, National Park Ser\-ice,

3 Fish and Wildlife Service, Department of the Interior, and

4 the Chief of the Forest Service, United States Department of

5 Agriculture, and shall reflect their best professional judgment

6 regarding the land acquisition priorities of such bureau or

7 agency.

8 "(c) In preparing such lists the following factors shall be

9 considered: the amount of money anticipated to be made

10 available in any one year; the availability of land appraisal

11 and other information necessary to complete the acquisition

12 in a timely manner; the potential adverse impacts on the

13 park, -wilderness, wildlife refuge or other such unit which

14 might result if the acquisition is not undertaken; and such

15 other factors as the land managers deem appropriate.

16 "Sec. 303. (a) The Secretary of the Treasur}- shall

17 notify the Appropriations Committees of the Congress on an

18 annual basis as to the amounts available for allocation •within

19 the special accoimt established pursuant to this titie.

20 "(b) The Appropriations Committees shall allocate the
Federal portion of

21 /funds from the special account in accordance with the priority

22 lists submitted pursuant to section 302(a) unless such lists are

23 speciScaUy modified in appropriation Acts or reports accom-

24 panying such Acts.

6 73S IS

1 "(c) In aliocatmg funds from the special account among

2 land managing agencies the Appropriations Committees shall

3 ensure that each agency receives a fur and equitable share in

4 accordance uith land acquisition needs, congressional direc-

5 tives, and historical patterns of distribution of the fund: Pro-

6 vided, That no agency shall receive more than 50 per centum

7 of the funds available from the special account in any one

8 year.

9 "(d) In the event that the Appropriations Committees

10 fail to allocate the funds from the special account, the Secre-

11 tary of the Treasury is authorized and directed to make such

12 funds directly available to the land managing agencies to be

13 used solely for land acquisition projects on the respective pri-

14 ority lists in accordance •with the following formula;

15 "40 per centum to the National Park Ser\-ice;

16 "40 per centum to the Fish and Wildlife Ser\'ice;

17 "15 per centimi to the Forest Ser»-ice; and

18 "5 per centimi to the Bureau of Land Manage-

19 ment.".

The Chairman. Mr. Jarvis with the National Park and Conserva-
tion Association.

STATEMENT OF T. DESTRY JARVIS, VICE PRESIDENT, CONSERVA-
TION POLICY, NATIONAL PARKS AND CONSERVATION ASSO-
CIATION

Mr. Jarvis. Thank you, Mr. Chairman. I will summarize my
statement very briefly.

We have three essential concerns about S. 735. The first is the
relationship of this legislation to a comprehensive revitalization of
the Land and Water Conservation Fund. The second is its single
agency focus, the provision in the bill that relates to revenue cap-
ture from refuge leasing; and the third is the potential impact on
the management of the national wildlife refuge system.

Separating the two provisions of your bill, I would say that we
appreciate your desire to resolve the unmet need for land acquisi-
tion. We share that concern and we want to work with you to
arrive at a mechanism to do that.

We support the concept behind the $160 million earmarked floor
in an acquisition program, but feel that that should be considered
in the context of a more full, more comprehensive review of the
whole land and water fund program and its revitalization along the
lines that the President's Commission suggested.

You have in your files a letter from a coalition of conservation,
recreation, and historic preservation groups, of which my associa-
tion is one, that recommends a series of things that might be done,
of which such a floor automatic fund would be one element.

We think it should be considered in the context of the broader
revitalization of the fund.

Second, I would say with regard to the single agency focus of the
refuge provisions in the bill, I would cite a General Accounting
Office report of June of 1984. If you recall at the time, throughout
much of 1983 former Secretary of Interior Watt was hell-bent to
lease the wildlife refuges without much regard to criteria.

The Congress got very concerned, passed on the continuing reso-
lution that year a provision halting any refuge leasing until the
Department developed an EIS and a comprehensive set of regula-
tions.

Secretary Clark then as he came in as the new Secretary of the
Interior issued a policy statement that there would be no more
leasing on units of the wildlife refuge system, and therefore the De-
partment was not going to do the regs and the EIS.

And that policy is still in effect today under Secretary Hodel.

The Chairman. And there is certainly no intent to change that
policy.

Mr. Jarvis. I understand that.

As of the date of this GAO report, the GAO says that about $7
million in revenues from oil and gas receipts were collected in
fiscal 1983 from 13 units of the wildlife refuge system. About $4.5
million of that $7 million came from the Kenei refuge in Alaska.

Currently, Kenei is the only refuge in Alaska that is leased.
Other refuges that are currently under this leasing program — the
Delta National Wildlife Refuge in your state of Louisiana produces

about $2 million in revenue at present, and the Aransas refuge in
Texas, the Salt Plains refuge in Oklahoma, Kavira Refuge in
Kansas, John Clark Saylor refuge in North Dakota, are among the
others that have ongoing oil and gas activities.

Nevertheless, the total of that coupled with the prospects, as this
report cites, it is unlikely to see significant increases in economic
uses of refuges, and the policy of the Department indicates to us as
long as the focus remains on the refuge system, a very small
amount of money potentially.

We would suggest that if the Congress is going to consider the
policy of capturing revenues from the leasing of public lands that
the first priority ought to be on capturing revenues, dedicating
them to conservation purposes, from the leasing on national forest
and BLM public lands which operate under a multiple use regime,
rather than a dedicated or primary purpose, as do refuges and
parks.

So that the parallel philosophy with the existing fund, that is as
you use up one public resource, the OCS oil and gas, a portion of
the proceeds from that be dedicated to conservation purposes— we
think we see a direct parallel with the forest and Bureau of Land
Management public lands, similar to the OCS program as it now
exists, but feel that the primacy that is placed in wildlife refuges
upon wildlife protection, habitat protection — and this gets into our
third area of concern — would put some undue pressure on the
refuge manager.

I recognize that your intent is not to do that. The Congressional
intent would likely not be to do that. Nevertheless, we have seen
the Department impose performance standards on its managers to
produce revenues, and that is — at one time a couple of years ajgo,
park superintendents were judged, their performance evaluation
was based on their revenue enhancement performance.

The Chairman. There is certainly no intent to do that here. In
fact, most of the outlook for this is ANWR.

Mr. Jarvis. I would just conclude, Mr. Chairman, by saying that
with a policy of no leasing on refuges and with the desire for a
comprehensive review of the land and water fund, we suggest that
you hold S. 735 in abeyance, or at least separate the two concepts
while a more comprehensive view is taken.

And we would be happy to work with you on that.

[The prepared statement of Mr. Jarvis follows:]

STATEMENT OF OF T. DESTRY JARVIS

VICE PRESIDENT, CONSERVATION POLICY

NATIONAL PARKS AND CONSERVATION ASSOCIATION

BEFORE THE

COMMITTEE ON ENERGY AND NATURAL RESOURCES
U.S. SENATE

ON S.735
JULY 14, 1987

Good afternoon Mr. Chairman and Members of the Committee. I am T. Destry
Jarvis, Vice President for Conservation Policy of the National Parks and
Conservation Association (NPCA) . I appreciate this opportunity to testify
today on behalf of the National Parks and Conservation Association, American
Rivers, Inc., Defenders of Wildlife and the Humane Society of the United States
regarding S.735. While we have all been ardent advocates of the Land and Water
Conservation Fund, we do have some serious reservations about this bill, as
written, which I would like to share with the Committee today.

As introduced, S.735 would give twenty-five percent of "...all revenues
received from competitive bids, sales, bonuses, royalties, rents, fees,
interest charges or other income derived from the leasing of oil and gas
resources within units of the National Wildlife Refuge System. . . " to a special
account within the Land and Water Conservation Fund. This special account
would also receive $160 million annually from the authorized, but
unappropriated, balance of the Fund. This money would be made available
without appropriation to federal agencies receiving revenue from the current
Fund based on a priority ranking of acquisition needs unless the priorities are
modified by the Appropriations Committees and/or the Committees take
affirmative action to appropriate the funds.

National Parks and Conservation Association

1015 Thirty-First Street, N.W., Washington, D.C. 20007

Telephone (202) 944-8530

We have three major concerns about this bill upon which I would like to
elaborate today. These are: 1) its relation to other proposed legislation to
expand and reauthorize the Land and Water Conservation Fund; 2) its single-
agency focus; and 3) its potential impact on management of national wildlife
refuges.

As you know, we are members of a coalition working to expand and
reauthorize the Land and Water Conservation Fund. We have invested a great
deal of time studying the current problems with the Fund and have attempted to
devise alternative strategies to ensure that the Fund lives up to its
potential. We appreciate your concern for and commitment to securing
additional revenue for land protection for the Land and Water Conservation
Fund. However, we do not believe that this bill is adequate to the task of
rejuvenating the Fund. The principal problem with the current fund does not
relate to a lack of revenue flowing into the fund- -as evidenced by its $5
billion authorized, but vinappropriated balance- -but to the outflow of funds.
If the current authorization level is to be retained, we see no reason to seek
out new or additional sources of funds. The problem with which we are faced
today is establishing a mechanism which will ensure that the authorized money
is actually spent to acquire critical conservation and recreation lands.
Recovering funds from existing or future leasing on national wildlife refuges
as a supplement to LWCF will not solve this major problem.

Further, revenue from leasing of national wildlife refuges is likely to be
a drop in the bucket compared to the total authorized level of the Land and
Water Conservation Fvind. A 1984 General Accounting Office study, "Economic

Uses of the National Wildlife Refuge System Unlikely to Increase
Significantly," found that oil and gas operations on national wildlife refuges
generated approximately $7 million in 1983. Presently a portion of this money
is returned to the general treasury to be shared with states under the Mineral
Leasing Act and a portion returned to refuges to repay expenses incurred in
leasing or given to counties in which refuges are located as a payment in lieu
of taxes. We have refrained from considering the special case of the Arctic
National Wildlife Refuge in our testimony. Even if oil and gas leasing were to
increase dramatically on other national wildlife refuges in the System in
future years, we do not believe that sufficient revenue would be generated to
compensate for the broader concerns we have outlined below.

Second, if as a matter of national policy, the Congress determines that it
would be appropriate to tap revenues from on-shore mineral leasing and
extraction, then it is our view that this policy should be put in place first
on general public lands administered by the Bureau of Land Management and the
U.S. Forest Service. On these lands, there is an inherent bias to lease, just
as there is on the Outer Continental Shelf. While resource conflicts do exist
on these lands, they are administered primarily for multiple uses. Tapping
revenues derived from leasing on these lands and dedicating these revenues for
conservation purposes would parallel the philosophy behind the current LWCF
program which taps OCS leasing revenue. Still, additional revenue from on-
shore leasing need only be considered in a scenario which contemplates a vastly
enlarged LWCF, requiring new funding sources.

Finally, we have reservations about the impact of this bill on current and
future management decisions involving leasing of national wildlife refuges. We

are concerned about the potential effects of this bill on the outcome of the
Arctic National Wildlife Refuge debate, however, our concerns extend more
broadly to the impacts on national wildlife refuges nationwide. The 90 million
acres in the National Wildlife Refuge System were established as refuges for
the protection and conservation of fish and wildlife and the preservation of
wildlife habitat. Enactment of S.735 would undermine this primary purpose of
refuges by creating an incentive to lease refuge lands. According to their
legislated purpose, refuges, like units of the national park system, have a
primary purpose against which all other uses must be tested objectively.
Secondary uses including oil and gas extraction are allowed in refuges only
when a determination can be made that "such uses are compatible with the major
purposes for which such areas were established." (16 U.S.C. 668dd(d) (1) ) .

This test of compatibility is extremely important. The GAO study found
that current "compatible" uses are indeed creating management conflicts for
national wildlife refuges, [p. 13] Further, the study concluded on page 29 that
the Fish and Wildlife Service does not have adequate data to effectively
monitor and control oil and gas operations on refuge lands: "Our
analysis. .. indicated that refuge managers believe oil operations have sometimes
caused serious damage to refuges; but these impacts are difficult to measure."
[p. 23]

In undertaking a determination of compatibility, increased leasing might
be more likely to occur at the expense of high quality resources if managers
knew that leasing revenue could be applied toward land acquisition. Agency
priorities and policy decisions are often controlled by budget and staffing
needs . A proposed program which offers additional revenue from sources within
an agency's management discretion is likely to become a priority. "We can get

the money to buy parcel X if we lease more land on parcel Y," could easily
become the prevailing attitude. In national wildlife refuges this might result
in less weight being placed on the environmental effects of leasing and
associated activities in the drive to increase revenue, particularly in
response to pressures from 0MB and other sources within the Administration.
Leasing might occur more often even in situations where professional judgements
of wildlife managers indicate that it would be undesirable or incompatible with
the wildlife protection mandate of the Fish and Wildlife Service -- thus
undermining the purposes for which the System was created.

For these reasons, we regret that we must oppose further consideration of
S.735. We appreciate this opportunity to present our views on this bill and we
will be glad to continue working with you to design a new Land and Water
Conservation Fund.

Tl ^on en

The Chairman. Well, let me say I appreciate your comments.
They are logical, they are considered. The only problem is I am
trying to deal with the art of the possible, and the art of the possi-
ble is we have got a train that may or may not leave the station.

And that is, the train is named ANWR. And if that train goes
out without you, you are never going to be able to get a ride on it
again.

There are some who would say do not buy a ticket because that
may make more likely the fact that the train leaves. I do not think
so, but if you do not have the ticket you are not going to be able to
come in and cash it in later.

As you know, this ANWR, if it is put in place, we can come in
and we can say, well, we ought to have the Great Outdoors Com-
mission and we ought to have a comprehensive statement and all
of that, and you will just be tap dancing because 0MB will be
saying no to everything you say and you will never be able to get
that revenue again.

I want to get it while it is possible.

But aside from that, I appreciate your concerns.

Mr. Jarvis. I am sure you are concerned about OMB's willing-
ness to seriously implement this or any other acquisition program.

The Chairman. OMB would have no choice on this, you see, be-
cause it is automatic. That is the distinguishing feature of this.
This is no Land and Water Conservation Fund that is just written
in the sky somewhere, that fades with the first cloud bank.

This is automatic. That money comes automatically, and you
have to repeal the law in order to stop the flow of money.

Thank you.

Tim Mahoney of the Sierra Club.

STATEMENT OF TIM MAHONEY, WASHINGTON REPRESENTATIVE,
SIERRA CLUB AND CHAIRMAN, ALASKA COALITION

Mr. Mahoney. Thank you, Mr. Chairman.

I am Tim Mahoney, Washington Representative of the Sierra
Club and Chairman of the Alaska Coalition. I will not repeat a lot
of our earlier discussions from our hearing on the Arctic Wildlife
Refuge in June.

I would like to endorse what Mr. Jarvis had to say about the im-
pacts that such legislation may have on other units of the Fish and
Wildlife Refuge, Wildlife Refuge System. We do not know, really,
what those impacts are.

Mr. Horn did not today have a very comprehensive idea of what
the impacts might be. But I think we would be very leary of budg-
etary pressures being leveled at wildlife refuge managers.

But let me just briefly discuss our position, as a group of people
who do not want the train to go on ANWR and do not want to buy
a ticket and do not want anyone else to buy a ticket, either.

We respect and appreciate

The Chairman. We want to reserve your rights to dynamite the
tracks if you can. [Laughter.]

Mr. Mahoney. We hope that you will be persuaded to protect the
Arctic Coastal Plain as a part of the wilderness system, and that
there will be no revenue that would ever accrue under a system

like S. 735. We are concerned that the possibility of such revenues
does affect the political debate.

This year we have already fielded concerns from the Budget
Committee in both houses, who are concerned and somewhat excit-
ed about possible revenues from leasing the Arctic Coastal Plain.

We cannot eliminate that from the debate, but to the greatest
extent possible we want the Congress to concentrate on the fact
that this is a de facto wilderness, it is in a wildlife refuge, and it is
in a state and a part of America's coastline where every other por-
tion of our coastline has been devoted to oil and gas development.

But I would also point out that, while the projected revenues
from bonuses and leases may be very great, they might be a one
year windfall. The odds on finding no significant oil in the Arctic
refuge are 81 percent, according to the Department of Interior. The
odds on there not being another Prudhoe Bay there are 99 percent,
according to the Department of the Interior.

But the loss of the wilderness would be permanent, and we are
chilled by Mr. Horn's suggestion that this really is the only place
that he could conceive of S. 735 applying. And we are concerned
that the oil industry representatives, which would not have to pay
any more for the leases as a result of S. 735, would use a bill like S.
735 to try to persuade the public that the mitigation of additional
revenues to the Fish and Wildlife Service, to the other land manag-
ing agencies, would justify opening this important area.

Thank you.

[The prepared statement of Mr. Mahoney follows:]

STATEMENT OF TIM MAHONEY

WASHINGTON REPRESENTATIVE, SIERRA CLUB

AND CHAIRMAN, ALASKA COALITION

BEFORE THE

SENATE COMMITTEE ON ENERGY AND NATURAL RESOURCES

CONCERNING S. 735

July lA, 1987

Mr. Chairman and members of the Committee:

I am Tim Mahoney, Washington Representative of the Sierra Club and
Chairman of the Alaska Coalition. The Alaska Coalition consists of
eighteen organizations which seek legislation to protect the coastal
plain of the Arctic National Wildlife Refuge as wilderness and which
oppose legislation which would direct the Secretary of Interior to lease
the coastal plain for possible oil and gas development. The Alaska
Coalition opposes S. 735, as introduced.

The bill as introduced provides a mechanism whereby twenty-five
percent of "all revenues received from competitive bids, sales, bonuses,
royalties, rents fees, interest charges or other income derived from the
leasing of oil and gas resources within units of the National Wildlife
Refuge System" shall be deposited into a special account within the Land
and Water Conservation Fund.

Furthermore, $160 million of proposed wildlife refuge energy
revenues shall be available to the Secretary of the Treasury without
appropriation (if the Congress fails to appropriate) for acquisition
projects of the four federal land managing agflncles.

-2-

We are concerned that the narrow focus of S. 735 on wildlife refuge
development could be used as an inducement to offer oil and gas leases
in refuges where fish and wildlife professionals would not find such
activity desirable or even compatible with wildlife protection goals.
Under current law, these public trust lands are acquired and managed
with an understanding that they are neither self-funding nor managed for
a high dollar return; they are managed for fish and wildlife resources.

These pressures could affect land use decisions within the Fish and
Wildlife Service, an ajency which has historically struggled for budget
dollars. Or it could be used by an Administration sympathetic to energy
interests but insensitive to wildlife or wilderness resources to "sell"
an unwise energy development program to a skeptical public. Or most
probably, the Office of Management and Budget, within the budgetary
process, could try to push the agency into developing its lands so that
other LWCF spending could be averted.

Specifically, S. 735 would affect the debate most greatly over the
fate of Alaska's Arctic National Wildlife Refuge. This refuge is the
only land on Alaska's North Slope not devoted to or available to energy
production. The coastal plain, first established as part of the Arctic
Wildlife Range in 1960, is a spectacularly beautiful area of arctic
tundra wedged between the Brooks Range and the Beaufort Sea.

We have compared this de facto wilderness with Africa's Serengeti
Plain because it is habitat for an undisturbed ecosystem dominated by a
giant herd of migratory caribou, and complete with the predators such as
wolves, wolverines, and grizzly (brown) bears. It is also home to
related arctic animals such as polar bears, and migratory waterfowl.
The U.S. Fish and Wildlife Service calls the Arctic National wildlife
■Refuge "the only conservation system unit that protects, in an
undisturbed condition, a complete spectrum of the arctic ecosystems in
North America." ( Arctic Refuge Resource Assessment , page 46). The

-3-

Service calls the coastal plain (1002 area) "the most biologically
productive part of the Arctic Refuge for wildlife and.. .the center of
wildlife activity." (page 46) These two factors make the coastal plain
unique and irreplaceable among all other areas.

West of the Arctic NWR are 7 million acres of state lands where
Prudhoe Bay and other oilfields are on line. To the west of the state
lands is the National Petroleum Reserve. Offshore, along the llOO-mile
coastline, are both federal and state leasing programs in the Beaufort
Sea.

We are convinced that leasing the coastal plain of the Arctic
Refuge will destroy the wilderness and will result in irrevocable
environmental impacts on this last undisturbed arctic ecosystem.
According to the Department of the Interior, the odds on not finding a
significant oil find are 81%. The odds on a Prudhoe Bay-size find are
1%.

Whether or not S. 735 were enacted would make no difference in the
bonuses, fees, or royalties which might be paid by petroleum companies
to the federal government. While these interests would not be adversely
affected, they would use such a fund distribution arrangement as an
argument with the public and with the Congress that the monies diverted
to the LWCF would act as "mitigation" for the environmental impacts of
development of the coastal plain.

We believe that the fundamental question facing Congress in the
Arctic Refuge is whether one parcel of land along America's Arctic coast
shall remain an undisturbed and vital wilderness or whether it, too,
will join the other 50 million acres of land on- and offshore which are
devoted by federal and state law to petroleum development.

-4-

Proponents of development try not to face the black and white
nature of wilderness protection but rather to frame the argument in
terms of game management and mitigation as if protection of an
undisturbed ecosystem is not very important to the debate or the
decision.

Given that the Arctic Refuge is not yet well known to the American
public, arguments of financial benefits to other unrelated parks,
refuges and forests will serve to aid development proponents not only in
suggesting further "mitigation" but also in their attempts to blur the
issues facing the Congress.

We hope that the Congress will study the issues surrounding the
future of the Arctic Refuge thoroughly and decide the

wilderness/development issue on its own merits apart from arguments on
revenue.

We hope this Committee will not proceed with S. 735 as introduced
or other legislation which might adversely alter the debate over the
future of the Arctic Refuge.

Thank you for this opportunity to testify.

100

The Chairman. Thank you very much, Mr. Mahoney.
Next we have Lonnie Williams, Vice President of the Wildlife
Management Institute.

STATEMENT OF LONNIE L. WILLIAMSON, VICE PRESIDENT,
WILDLIFE MANAGEMENT INSTITUTE

Mr. Williamson. Thank you, Mr. Chairman.

There are several things about S. 735 that we support, one of
course being the dedicated source of funding for the Land and
Water Conservation Fund activities. However, in our view the
problem with the Land and Water Conservation Fund at present is
not the pipe that is going into the top of the fund, but it is an im-
pediment in the spigot coming out the bottom.

And therefore, we would oppose the use of revenues from the ex-
ploitation of oil on natural wildlife refuges for Land and Water
Conservation Fund purposes. We suggest that, however, that we
not miss the train, as you say, and that the national wildlife refuge
oil and gas revenues, if there will be any substantial amounts in
the future, would serve more logically to finance programs that are
directly and completely related to the purposes for which that
refuge system was established.

As an alternative, we would recommend that the Committee sup-
port investing future oil and gas revenues into financing such
things as a North American waterfowl management plan, imple-
menting the Fish and Wildlife Conservation Act of 1980, paying in
lieu taxes to county, borough, and parish governments, and serving
other purposes of the refuge system.

One way that we would suggest be considered to do that is, in-
stead of directing any future moneys that might come as a result of
oil and gas development to the Land and Water Conservation
Fund, is to direct it into the migratory bird conservation fund,
where special accounts, if the Congress so chooses, could be set up
whereby the various programs related to the national wildlife
refuge system could be considered for financing or could be fi-
nanced from.

And some of these big ticket items, such as you well know, the
North American waterfowl management plan, there is going to
have to be some kind of windfall, as what one might anticipate
from an oil and gas exploration, before these kinds of things can
ever be funded, especially in today's climate that you gentlemen
have to live with as far as the budget is concerned.

Thank you.

[The prepared statement and a subsequent submittal from Mr.
Williamson follow:]

101

Wildlife Management Institute

Dedicated to Wildlife Since 1911

Suite 725, 1101 14th Street, N.W.

Washington, D.C. 20005

202/371-1808

Statement of Lonnie L. Williamson
before the
Senate Committee on Energy and Natural Resources
on
S. 735 (Amendment to the Land and Water Conservation Fund Act)

July lA, 1987

Mr. Chairman:

I am Lonnie L. Williamson, vice-president of the Wildlife Management
Institute. Headquartered In Washington, D.C, the Institute Is staffed by
professional resource managers and has been dedicated since 1911 to the resto-
ration and Improved management of wildlife. We appreciate the opportunity to
present our views on S. 735.

The Institute supports language in S. 735 that would establish a dedicated
source of financing for federal Land and Water Conservation Fund activities.
We also appreciate the provision that would require recipient federal agencies
to maintain "priority lists" of lands that they need to acquire for improving
their programs. And, we agree with the idea that funds from the unappropriated
balance of LWCF be made available for land acquisition purposes. However, we
oppose the use of revenues generated by resource exploitation on national
wildlife refuges for LWCF purposes.

The National Wildlife Refuge System, as well as other programs which
support the purposes of that system, is in dire need of financial support.
For example, funds have not been generated in recent years for the System to
pay more than about half of its In-lieu tax debt to county, parish and borough
governments. This situation creates antagonism toward existing refuges and
future refuge system expansion. The need to acquire wetlands and other areas

102

for migratory birds and endangered species far exceeds available funds. The
North American Waterfowl Management Plan, which has been signed by the U.S. and
Canada, must be expedited if this continent's waterfowl and associated nongame
species are to survive in appreciable numbers. The Fish and Wildlife Conservation
Act of 1980, a statute aimed specifically at preserving the nation's nongame
wildlife, has never been funded.

We suggest that national wildlife refuge oil and gas revenues would serve
more logically to finance these programs which are directly and completely
related to the purposes for which the refuge system was created. After all,
refuges are wildlife lands, and any habitat degradation that may occur from oil
and gas development on those areas is particularly damaging to migrating wildlife
nationally and internationally. Thus, using revenues generated from refuge
petroleum extraction to enhance the country's wildlife seems most appropriate.

Therefore, we urge that refuge revenues not be separated in large part
from the refuge system by diverting them to the Land and Water Conservation
Fund. As an alternative, we recommend that the Committee support investing
future refuge oil and gas revenues into financing the North American Waterfowl
Management Plan, implementing the Fish and Wildlife Conservation Act of 1980,
paying in-lieu taxes to county, borough and parish governments and serving
other purposes supportive of the refuge system.

We suggest that the Committee consider melding S. 735 with a subsequently
introduced bill, S. 1338. The result could establish a dedicated $1 billion
Land and Water Conservation Fund from offshore oil lease receipts and possibly
taxes on large real estate transfers and conservation bonds as recommended in
S. 1338.

Mr. Chairman, we applaud and support the Committee's effort to assure
financing for the Land and Water Conservation Fund during these difficult
budgetary times .

103

LAURENCE R. JAHN

Presidem

tONNIE L. WILLIAMSON

Vice-President

DANIEL A. POOLE

Board Chairman

Wildlife Management Institute

Suite 725, 1101 14th Street, N.W., Washington, D.C. 20005 • 202/371-1808

July 16, 1987

The Honorable J. Bennett Johnston, Chairman
Conunittee on Energy and Natural Resources
United States Senate
Washington, D.C. 20510

Dear Senator Johnston:

This letter responds to your request for specific suggestions on legis-
lation to redirect future national wildlife refuge oil and gas revenues.

We agree with your assessment that a mechanism for distributing some of
the refuge oil and gas revenues to land acquisition and management programs
should be enacted before a decision is made on developing Arctic National
Wildlife Refuge petroleum. However, we feel strongly that such revenue ought
to be invested in wildlife restoration and enhancement which support refuge
system purposes, rather than goals of the Land and Water Conservation Fund.

As I mentioned at the hearing, LWCF' s problem is not a lack of funding
going into the program. Instead, it is the absence of a trust arrangement
whereby the $900 million per year from offshore oil leasing and other sources
is isolated and automatically made available to state and federal agencies.
Your provisons in S. 735 to create a "special account" with guarantees of
appropriation or allocation would fill that need, and we urge you to pursue
such a refinement for LWCF.

With regard to refuge oil and gas receipts, we recommend that legislation
be considered to accomplish the following:

A) Establish a "special trust fund" in the Migratory Bird Conserva-
tion Account (MBCA);

B) Distribute all revenues received from competitive bids, sales, bonuses,
royalties, rents, fees, interest charges or other income derived from oil and
gas leasing within the National Wildlife Refuge System as follows:

(1) 50 percent to the state in which the refuge is located;

(2) 40 percent to the MBCA "special trust fund";

(3) 10 percent to the federal treasury.

DEDICATED TO WILDLIFE SINCE 1911

104

Hon. J. Bennett Johnston -2- July 16, 1987

C) Establish a per-barrel access fee for oil, and a comparable amount
for gas, taken from refuges, with all of the receipts deposited directly into
the MBCA trust fund.

D) Instruct the Migratory Bird Conservation Commission and the U.S. Fish
and Wildlife Service to divide the "special trust fund" into three accounts
with:

(1) 50 percent of the fund dedicated to implementing the North American
Waterfowl Management Plan. Authority should be given to the U.S. Fish and
Wildlife Service for investing a portion of the funds in Canada, as required by
the Plan. When the plan is fully implemented, any monies accruing to the
account should revert automatically to normal land acquisitions approved by the
Migratory Bird Conservation Commission;

(2) 35 percent of the fund dedicated to implementing the Fish and Wild-
life Conservation Act of 1980 and transferred to the Federal Aid Division in
the U.S. Fish and Wildlife Service for that purpose;

(3) 15 percent of the fund dedicated to implementing the Service's
refuge fisheries management plan;

(4) An equal percentage of all three accounts in the fund debited annually
and deposited in the National Wildlife Refuge Fund to the extent needed for
completing in-lieu tax payments to counties.

As reported at the June 14 hearing, these programs are in desperate need
of financing and are directly related to the purposes of the refuge system. We
would be honored to assist with devising a program such as recommended above.

Best regards.

Sincerely,

(MUUM'>^

Lonnie L. Williamson
Vice-President

LLW:dt

105

The Chairman. Thank you, Mr. Williamson.

And let me repeat again that, if we enact 735 into law, it would
be my intention to come back and have that comprehensive review
that we have talked about as to that all of these uses. And as a
strong supporter of waterfowl management, I would certainly want
very carefully to consider your recommendations as to that.

Finally, we have Jack Berryman, Executive Vice President of the
International Association of Fish and Wildlife Agencies.

STATEMENT OF JACK H. BERRYMAN, EXECUTIVE VICE PRESI-
DENT, INTERNATIONAL ASSOCIATION OF FISH AND WILDLIFE
AGENCIES

Mr. Berryman. Thank you, Mr. Chairman.

First, I want you to know our Association is ready to work with
the members of the Committee and others to assure reauthoriza-
tion of the Land and Water Conservation Fund and the amend-
ments that will increase the fund's capability for the acquisition of
needed lands.

We are very supportive of the concept of establishing an auto-
matic appropriations mechanism that will utilize the unexpended
funds. Also, we are supportive of the idea of the federal agencies
maintaining priority lists.

Now, we do not agree with the proposal to take revenues from
the refuge system and make them available to other federal agen-
cies for land acquisition, for the reasons Mr. Williamson just
stated.

The refuge system has vast unmet needs. In addition, there is
great need to support the North American waterfowl management
plan, and we, along with others, have made suggestions on the uses
of funds that might become available if the Arctic National Wild-
life Refuge is indeed opened to exploration.

And it is our strong belief that a very significant portion of these
revenues should be dedicated to the purposes for which the nation-
al wildlife refuge system was founded, and this includes the North
American waterfowl management plan, the development of fishing
opportunities on the refuges, and funding for the Non-Game Act.

And a copy of that statement is submitted for the record.

If I may, finally, we just appreciate the opportunity to comment
and we look forward to working with you, subject to the concerns
we have expressed.

Thank you, sir.

[The prepared statement of Mr. Berryman follows:]

106

International Association of Fish and Wildlife Agencies

■C'ljnr.ci'J ,:.■;; ' (02)

STREET LOCATION: 1325 Massachusetts Av., N.W. (202) 639-8200
MAILING ADDRESS: 1412 16lh St., N.W., Washington, D.C. 20036

Jack H. Bwiyman. Execiillw VIca Presktom

STATEMENT OF THE INTERNATIONAL ASSXIATION OF FISH AND WILDLIFE AGENCIES

BEFORE THE SENATE COMMITTEE ON ENERGY & NATURAL RESOURCES

ON AMENDMENT TO THE LAND AND WATER CONSERVATION FUND (S. 735)

July 14, 1987

Jack H. Berryman, Executive Vice-President

The International Association of Fish and Wildlife Agencies, founded
in 1902, is a quasi -governmental organization of public agencies charged
with the protection and management of North America's fish and wildlife
resources. The Association's governmental members include the fish and
wildlife agencies of the states, provinces and federal governments of the
U.S., Canada, and Mexico. All 50 states are members. The Association
has been a key organization in the promotion of the principles of sound
resource management and the strengthening of federal, state and private
cooperation in protecting and managing fish and wildlife and their
habitats in the public interest.

The Association is pleased to have the opportunity to comment on a
proposed amendment to the Land and Water Conservation Fund. The Fund has
been a valuable and important tool for acquisition of federal and state
public lands. Much of these lands have benefitted fisheries and wildlife
by protecting much needed habitat.

The Association is pleased that members of Congress are supporting
the continued acquisition of lands and waters for the benefit of fish and
wildlife and the millions of Americans that continue to enjoy these
public resources in various ways. The several bills that seek to

107

-2-
reauthorize and/or amend the Land and Water Conservation Fund are ample
proof of the interest of many members. The Association is ready to work
with members of this Committee and others to assure reauthorization of
the Land and Water Conservation Fund and amendments that will increase
the Fund's capability for acquisition of needed lands.

We are especially supportive of the concept of establishing an
automatic appropriation mechanism that will utilize unexpended LWCF
funds; also to require federal agencies to maintain "priority lists" of
lands they consider necessary for program involvement.

The Association does not agree with proposals to take revenues from
the refuge system and make them available to other federal agencies for
land acquisition. The refuge system has vast unmet needs for operation
and maintenance. The system also needs expansion to meet the goals of
wetland preservation, as well as the needs of the North American
Waterfowl Management Plan. The National Wildlife Refuge System is
enjoyed by all citizens and in many different ways. It serves the needs
of public resources and is indeed a national heritage.

Further, this Association, and several others, have already made
suggestions on uses of funds that would be available if the Arctic
National Wildlife Refuge, which offers the only significant opportunity
for revenues, is opened to exploration. A significant portion of those
revenues should be dedicated to the purposes for which the National
Wildlife Refuge was founded, including: funding of the North American

108

-3-
Waterfowl Management Plan; expansion of the National Wildlife Refuge
System; enhancement of the refuge fishery program; and additional funding
of fish and wildlife management programs, including the Fish and Wildlife
Coordination Act. A copy of that statement is attached for the record.

We appreciate this opportunity and commend the Comnittee for its
efforts to assure continuation of this important source of funding. The
Association will be considering the several proposals that relate to
refuge revenues at its annual meeting in September.

Thank you.

109

ACCOMMODATING FISH AND WILDLIFE NEEDS FROM POTENTIAL ENERGY RESOURCE DEVELOPMENT

ON THE ARCTIC NATIONAL WILDLIFE REFUGE

-AN OPPORTUNITY-

The Arctic National Wildlife Refuge (ANWR) is one of the largest wildlife
refuges in the world. In addition to its abundant and valuable fish and wildlife
resources, ANWR may also contain very large reserves of oil and gas resources.

This brief statement represents the collective perspective of several natural
resource conservation/professional organizations, whose representatives recognize
that assessing the national need for energy reserves that may be under the Arctic
Coastal Plain is not within their collective expertise. Within these
organizations, however, considerable insight and expertise exist on the needs and
management of fish and wildlife resources of the Arctic Coastal Plain, as well as
other areas of this Nation.

ANWR is a unique and significant part of the world's most advanced wildlife
refuge system. The National Wildlife Refuge System was established to meet the
immediate needs for migratory waterfowl at a difficult time; it also looked to the
future of a wide variety of fish arid wildlife resources.

A decision to open ANWR to oil and gas development should not be taken unless
the adverse impacts on the refuge's fish and wildlife resources are minimized and
unless a substantial portion of the revenues generated are used for fish and
wildlife enhancement.

If the Congress determines that exploration and extraction on ANWR are in this
Nation's best interest, the resulting revenues must contribute to fish and wildlife
conservation. There are several valuable needs that must be served from the
various revenues that may be generated. Quite simply, we believe that a reasonable
portion of the revenues must be identified for fish and wildlife management
purposes.

The foremost need is to further the purpose of the National Wildlife Refuge
System. Needs in this arena include:

1. Funding of the North American Waterfowl Management Plan . This plan
represents several decades of effort by the United States Fish and Wildlife
Service, the Canadian Wildlife Service, state fish and wildlife agencies
and cooperating organizations. It is a comprehensive statement of needs
for viable waterfowl populations. It identifies needed research and survey
work, but most importantly, stresses that acquisition of important habitats
is a top priority for the migratory waterfowl resource of this continent.

2. Expansion of the National Wildlife Refuge System. The System meets the
needs of many species of migratory birds, as well as many other wildlife
species. It also is enjoyed and visited by more than 30 million Americans
each year. To meet the continuing habitat requirements and the educational
needs of citizens interested in wildlife, the System must be expanded.

3. Enhancement of the refuge fishery program . The extensive wetlands, lakes,
ponds and riverine systems within the National Wildlife Refuge System also
provide valuable fishery habitats and fishing opportunities. Enhancement

of the fishery program on the System is needed to expand its use, build a
broader constituency and meet the demands of the growing sport fishery in
this Nation.

110

4. Additional funding of fish and wildlife management programs . In 1980, the
Fish and Wildlife Conservation Act was passed. This Act recognizes that
both the federal and state governments have responsibility for all species
of wildlife and that additional funding is needed for habitat protection
and balanced wildlife programs. The Act has never been funded even though
citizen interest and participation in wildlife observation and other
non-harvest activities continue to increase each year.

Only a small percentage of Americans are likely ever to experience ANWR first
hand. We think it is very essential that any returns from the ANWR resource have a
constructive impact on fish and wildlife resources throughout the Nation,
particularly in areas more appropriate for public access and enjoyment.

The organizations indicated believe that a substantial portion of the potential
oil and gas revenues should and must be earmarked for enhancing and improving
conditions for fish and wildlife, and that such provision would find favor with the
public. We would be pleased to work with the Congress to develop and support this
concept.

American Fisheries Society

International Assocation of Fish and Wildlife Agencies

National Wildlife Refuge Association

Sport Fishing Institute

Trout Unlimited

Wildlife Management Institute

Ill

The Chairman. Thank you very much, Mr. Berryman.

Let me say that one of the problems for using this money for
management purposes, as opposed to land acquisition, is that the
fund, if we created it, would then — it might then be used just as a
substitute for dollars that otherwise were going to be spent on the
budget anjrway.

I know about the huge needs, for example, at the national parks
and at the wildlife refuges for management funds. Indeed, we have
just passed legislation out of this Committee, enacted into law, to
increase funds on our parks system to get that management
money.

And one of our greatest concerns was that those additional funds
not replace the annualized budgets, considering the pressure from
0MB and others. So that is our dilemma with respect to manage-
ment funds.

But I really think if we have a fund to manage, which 735, or a
potential fund to manage, which 735 would give us, then we could
consider that overall management plan, overall reconsideration of
the Land and Water Conservation Fund, and all of these various
competing uses.

Local funds — I mean, local match for parks and recreation, have
been a very strong priority of mine that ought to fit into the propo-
sition somewhere, and I think it could. I think it deserves a thor-
ough airing and a thorough debate.

But I get back to the basic purpose of S. 735 is not to move
ANWR, as those of you who have seen our hearings here — I stated
before the hearings and during the hearings and at all phases of
those hearings that I personally, and I hope the Committee, would
keep a completely open mind and listen to all of the evidence pro
and con before any decisions of any kind are made.

And I hope the Committee will do that, and I think they have. I
mean, obviously some Committee members have their points of
view, but I think most Committee members are very carefully con-
sidering this question.

And I think it is possible for a Committee member and a
member of Congress to consider what you might use the funds on
S. 735 or the ANWR funds for. You can consider that without that
influencing what you do on ANWR.

If you think about it, there are two alternatives: first, to consider
it as part of the ANWR legislation as it comes up. Then everybody
can come in and say, well, we had a compromise here, we gave a
little bit to the environmental community, and we compromised it
and allowed the drilling to proceed.

Or the second alternative, which is the worst of all worlds, is just
to ignore it altogether, let the train leave the station, and then
come back next year and say: Well, why don't we increase the
Land and Water Conservation Fund to a billion dollars and take it
out of — where?

You know, then you try to break the bank with 0MB. You are
not going to have the Department of the Interior and the Depart-
ment of Agriculture coming in and saying, we are taking no posi-
tion with respect to your bill. They are not going to be saying that.

If you have already passed the legislation, then they are going to
be saying: We have got the needs of the old folks who have to have

112

nutrition, we have got the needs of education, and you can go right
down the Utany list. And when you go down that Ust, as much as I
believe in parks and recreation and wildlife refuges and all of those
needs, it is hard to grab somebody else's money for those needs.

And I have tried to do it, lo these many years, with only occa-
sional success.

So now that we have got everybody in the mood, the Administra-
tion says: Well, we do not know, we may not be for it, but go
ahead, we will look the other way. For gosh sakes, let us do it and
then forget about it and not let that influence at all what we do on
ANWR.

And after all, you may win the battle this year on ANWR, and
next year there may be an energy crisis, or the year after that, or
maybe five years from now, and we will be awfully glad that we
have something in place to give us these funds if that happens.

I am not asking, really, for the support of the environmental
community, because I well understand that you cannot be per-
ceived as making, in effect, a compromise. But if you will, all of
you have made your positions clear. I have got a letter with virtu-
ally every environmentalist in the country.

And by the way, I appreciated the words of praise in the letter. It
is only the conclusion that I disagree with. [Laughter.]

The Chairman. But this is the most gilt-edged list of environ-
mentalists in the whole country, including my son's boss is on here.

So I hope, that position having been made clear, you will let us
go ahead and pass it if we can. And as I say, then consider ANWR
in a completely dispassionate and uninfluenced arena and point of
view.

Gentlemen, we always appreciate your testimony and your
advice.

I do have an amendment vote that I have to go to, after which I
will go to the 302(b) allocation.

If there is anything that you think of after this hearing that you
want us to consider in writing or orally, please let us know. In
other words, you may continue to oppose the bill, but say, just in
case it passes we would like for you to redo it in this way or that.
We would like that advice.

Thank you very much.

[Whereupon, at 3:45 p.m., the hearing was adjourned.]

APPENDIX

Additional Material Submitted for the Record

'DED\^^

THE WILDERNESS SOCIETY

STATEMENT OF GEORGE T. FRAMPTON, JR., PRESIDENT, TO THE PUBLIC
LANDS, NATIONAL PARKS, AND FORESTS SUBCOMMITTEE OF THE SENATE
ENERGY AND NATURAL RESOURCE COMMITTEE REGARDING THE LAND AND
WATER CONSERVATION FUND, JULY 14, 1987.

The Wilderness Society appreciates this opportunity to
submit its views on Senate Bill 735, "Amendnents to the Land
and Water Conservation Fund," for the hearing record of
July 14, 1987. The Wilderness Society is a national conserva-
tion organization with over 175,000 members nationwide. The
Wilderness Society joins the Alaska Coalition, the National
Parks and Conservation Association, and other major conservation
organizations in strongly opposing S. 735.

The Society appreciates the efforts of the bill's author,
the distinguished Chairman of the Energy and Natural Resources
Committee, Senator Bennett Johnston, to assure a steible source
of funding for the Land and Water Conservation Fund. The bill
provides a mechanism whereby twenty-five percent of "...all
revenues received from competitive bids, sales, bonuses, royal-
ties, rents, fees, interest charges or other income derived from
the leasing of oil and gas resources within units of the
National Wildlife Refuge System..." shall be deposited into a
special account within the Land and Water Conservation Fund. In
his statement accompanying introduction of the bill. Senator
Johnston said, "What this really means is if we lease the Arctic
National Wildlife Refuge in Alaska which many think is as rich
as Prudhoe Bay, we will get dedicated to this fund 25 percent of
those revenues, whether from bonuses, leases, or royalties, and
they will come automatically to the fund." Senator Johnston
went on to say that "this bill does not prejudge what we should
do with respect to leasing or exploration or development in the
Arctic National Wildlife Refuge."

S.735's passage will in fact seriously prejudice the debate over
AMWR.

We have no doubt that Senator Johnston does not intend
S. 735 to prejudice or influence Congressional deliberations on
the fate of the Arctic National Wildlife Refuge. Unfortunately,
we are convinced that the passage of the bill will be used by
others to do precisely that, regardless of Senator Johnston's
good intentions. Passage of the bill would make it easier for

1400 EYE STREET, N.W., WASHINGTON, D.C. 20005
(202) 842-3400

(113)

114

many to support opening up the Arctic Refuge to oil and gas
leasing on the grounds that the damage done to the Refuge is
compensated for in part by the fact that some of the proceeds
will be used to save land elsewhere. We oppose this trade-off.
As we have already testified at length before this Committee,
the Refuge is the last unspoiled area of its kind in the entire
Northern Hemisphere, and should be preserved as wilderness.

S. 735 incorporates a dangerous precedent into the Land and
Water Conservation Fund by encouraging development of existing
conservation units.

The funding mechanism in the bill will result in tremendous
pressure being placed upon Fish and Wildlife Service personnel
to lease other xinits of the National Wildlife Refuge System in
order to generate revenues, even where such leasing is not
really consistent with the purposes for which the refuges were
established. It certainly was not Congress' intention in
setting aside the refuges that they were to serve as fundraising
mechanisms for federal land acquisition programs. The refuges
are supposed to protect our fish and wildlife resources, includ-
ing endangered species.

S. 735 should be considered together with other legislation
exploring alternative methods for future funding of the Land
and Water Conservation Fund.

The Wilderness Society is actively participating in the
on-going search within both the conservation community and the
Congress to find a mechanism which will assure stable funding
for the Land and Water Conservation Fund. It is our firm belief
that the mechanism of S. 735 is not the answer. The bill should
be the spark that ignites a series of hearings and debates by
the Energy and Natural Resovirces Committee over future appropri-
ation alternatives for the Land and Water Conservation Fund,
especially in light of other LWCF bills recently introduced in
the Senate. This hearing should be the first and not the last
in a series of hearings by the Public Lands Subcommittee to find
a better mechanism for the Land and Water Conservation Fund.

If S. 735 is to be seriously considered by this Ccxnnittee, a
$160 million level is far too low.

S. 735 automatically dedicates $160 million a year from OCS
receipts to federal land acquisition dollars. However, $160
million of dedicated funds does little in the way of correcting
the backlog of acquisition projects, and is less than the
appropriations process has provided in the past 10 years. Last
year Congress appropriated $185 million in LWCF funds, in a very
austere budget period. This year the Senate Budget Committee
reported to the Senate floor a budget resolution containing $250
million in budget authority for LWCF. The House two weeks ago

115

passed its FY' 88 Interior Appropriations bill which contained
approximately $125 million for LWCF. With possibly higher
budget allocations in the Senate, there are expectations of
passing the FY' 88 appropriations for LWCF eJDOve the $160 million
level.

Setting an amount of dedicated land acquisition dollars by
taking an average from the last six years of the Reagan-Watt
Administration era would not be a step forward in reforming the
Land and Water Conservation program, but a step backwards. We
believe the support by the Appropriations Committees in the
House and Senate to fund LWCF, despite zero administration
budgets and restrictive budget ceilings demonstrates the will-
ingness of Congress and the American public to protect and
preserve our nations' natural and recreational lands.

For these reasons we oppose S. 735. Thank you for the
opportunity to comment on this important matter.

116

TESTIMONY BY DERRICK CRANDALL, PRESIDENT, AMERICAN RECREATION
COALITION, BEFORE THE UNITED STATES SENATE, SUBCOMMITTEE ON
PUBLIC LANDS AND RESERVED WATER, REGARDING S.735, A BILL TO AMEND
THE LAND AND WATER CONSERVATION FUND, JULY 14, 1987. -^

The American Recreation Coalition is pleased to submit its
thoughts on proposed amendments to the Land and Water
Conservation Fund, including those contained in S.735. Our
organization is a national federation of more than 100
organizations and corporations with a vital interest in the fund
and its contribution to outdoor recreation opportunities.
Moreover, ARC and its staff played an active role in debate by
and before the President's Commission on Americans Outdoors
regarding the future of the fund.

We applaud the initiative of Senator Johnston in bringing
before this body new ideas for the fund, including the earmarking
of receipts attributable to oil and gas activities within units
of the national wildlife refuge system. We share his belief that
such receipts can and should result in a lasting benefit to
conservation and recreation. We also share the Senator's
conviction that some oil and gas development can occur safely
within some refuges.

Yet we are not prepared to urge passage of this measure
because we believe that important debate remains needed on the
goals of the LWCF or its successor into the 21st century and on
the mechanisms which are roost likely to achieve those goals.

Americans today can be proud of joint ownership of the
world's first and best national park system, a marvelous national
forest system, extensive refuges for wildlife, a diverse network
of state, county and local tracts and other public lands. This
collage of quality outdoors resources is a monument to
thoughtful, concerned Americans of past generations. The result
is an unequalled choice of outdoor activities for us today. We,
in turn, have an obligation to pass on this legacy and to
contribute to it in a real way. The LWCF, or its successor, can
be a vital tool in making this contribution.

We would offer three goals for the revised fund:

• it should enable us to protect and improve the existing
federal land systems, especially through acquisition of
lands and interests in land within designated unit
boundaries .

• it should assist in addressing the need labeled as the
most pressing by the President's Commission on Americans
Outdoors: open spaces in and around our urban areas.

• it should assist in the development of those facilities
and features which are needed to maximize the enjoyment of
the outdoors, from trails to swimming areas.

117

TESTIMONY BY DERRICK CRANDALL

LAND AND WATER CONSERVATION FUND AMENDMENT

PAGE TWO

To achieve these goals, we believe some new approaches can
be taken. First, negotiations for the purchase of land, or
interests in land, are often protracted undertakings. Moreover,
negotiations can occur only when the prospective buyer has a
means to consummate the sale. For this reason, we strongly favor
a true trust fund, with a dedicated source of revenues and a
multiple year appropriation authority. While unusual, funds of
this type do exist, and even exist in the natural resources
field. Both the Pittman/Robertson Trust Fund and the Aquatic
Resources Trust Fund (better known as the Wallop/Breaux Trust
Fund) are such examples. Sources and levels of funding for this
program deserve full discussion, but we support the earmarking of
a percentage of OCS receipts to this cause. As the nation
decided through its elected representatives in 1965, it makes
sense for all Americans to gain a permanent legacy from the sale
of nonrenewable public resources.

We urge this committee to consider funding five separate
programs from this new and strengthened fund:

• federal land acquisition for all land managing agencies;

• state and local land acquisition grants, with the federal
share of total cost ranging up to 50%;

• federal road maintenance and rehabilitation, for public
roads not part of state or local road systems;

• state and local recreation facility and feature
development loans; and

• innovation grants for federal, state, local and nonprofit
recreation initiatives.

Several of these programs are quite traditional, but several
represent important departures from past LWCF practices. We urge
consideration of a permanent diversion of an appropriate sum from
the Highway Trust Fund to the new trust fund in an amount equal
to the needs of federally-maintained roads within our lands
system which are essential for recreational access. We do not
propose a program to build new roads, but rather a program to
ensure that the roads which now exist offer safe passage to the
millions of Americans using them each year.

We also recommend that the state grants program be modified.
We find great appeal to the philosophy that a portion of the
receipts collected from the sale of a nonrenewable resource, in
this case Outer Continental Shelf oil and gas resources, should
be reinvested in a way which leaves a lasting legacy. And
because the greatest need for additions to the legacy we now
enjoy is for close-to-home areas near our urban centers, we
believe federal assistance to state and local government efforts
should be provided. We would like to see this assistance act as
a catalyst for comprehensive efforts to protect and make

118

TESTIMONY BY DERRICK CRANDALL

LAND AND WATER CONSERVATION FUND AMENDMENT

PAGE THREE

accessible open spaces, including shaping growth. Perhaps the
federal share of land acquisition projects should be 33% except
where a jurisdiction has completed a strategic plan for meeting
its needs. In those cases, the federal match could be higher,
since many costs would be internalized by the residents of the
area. We would urge an end to grants for facility development,
however, since these investments — while critically important —
are not permanent legacies but depreciating structures.

The result would be a state grants program with eligibility
criteria comparable to the federal acquisition program.

State and local recreation development projects could still
be aided, though, through a program included in the
recommendations of the PCAO: a loan program which provides for a
high percentage of project costs, with no- or low- interest rates
and designed to allow projects to be completed and, at least in
some cases, generating fees before payback begins. The permanent
legacy concept would continue, since loans could be repaid to a
permanent revolving loan fund. After a period of years —
perhaps fifteen — loan repayments would be sufficient to
continue the program without new federal dollars.

We also strongly endorse the commission's recommendation for
a new innovation grant program, designed to encourage creativity,
experimentation and partnerships. Change is a reality in
America's recreational preferences, and land managing
institutions often face difficulties in keeping pace with these
changes. We believe a special innovation grants program, open to
federal, state and local agencies as well as nonprofits, could
counteract those difficulties.

As a final note, we urge the committee to consider the
earmarking of a specific percentage of OCS receipts to the LWCF
successor. This strikes us as a fair means to insure that es
revenues climb, an appropriate increase in revenues will result
while also assuring that this program will not lay claim to a
disproportionate share of the receipts during periods of low OCS
activity.

A chart displaying the operations of the revised fund is
attached for the committee's consideration.

We thank you for your attention to these suggestions.

Derrick A. Crandall, President

American Recreation Coalition

1331 Pennsylvania Avenue, NW, Suite 726

Washington, D. C. 20004 (202)662-7420

119

Western Governors' Association

600 1 7th Street
Suite 1 205 South Towei
Denver. Colorado 80202-5442
(303) 623-9378

Telecopier. (303) 534-7309
Telex, 617668 (WGADVR)

Norman H Bangeilei

Governor ol Utah
Chairman

Booth Gcndnei
Governor ol Washington
Vice Chairman

PaulM Cunningham
Executive Director

July 7, 1987

The Honorable Dale Bumpers

Chairman

Senate Subcommittee on Public

Lands, National Parks and Forests
308 Dirksen Senate Office Building
Washington, D.C. 20510

Dear Mr. Chairman:

fS^V

6^^'

The Western Governors would like to express their opposition to S.735,
legislation which would amend the Land and Water Conservation Fimd (LWCF).
This bill would change a longstanding Federal philosophy regarding the use of
public lands and may not resolve the constraints which have hindered
implementation of the Land and Water Conservation Fund.

The Minerals Leasing Act of 1920 and the Reclamation Act of 1902 currently
provide for the distribution of revenues to state governments from oil and gas
leasing within units of the National Wildlife Refuge system created from
public lands. Under these laws, our states are entitled to receive 50 percent
of the rents, royalties and bonuses from leasing, /in additional 40 percent of
these revenues finance the Reclamation Fund which is used to develop
reclfunation projects in our states.

S.735 would reduce the states' share of revenue derived from petroleum
leasing in National Wildlife refuges by depositing the revenues which would
have gone into the Recleunation Fund under current law into the LWCF and the
miscellaneous receipts of the Treasury.

The Minerals Leasing Act and the Reclamation Act are just two of a number
of Federal laws which assist wester states by sharing the receipts for the use
or development of the natural resources on Federal lands within their
boundaries. These laws reflect a philosophy of land management which Congress
has consistently applies since the turn of the century. That philosophy
embodied a compromise in which the Federal government retained, rather than
disposed of, large areas of public lands within a state's boundaries. In
exchange, the affected states were to receive a set share of the revenues
produced from development of those lands.

120

The Honorable Dale Bvunpers
July 7, 1987
Page 2

The legislative history of the Minerals Leasing Act of 1920 illustrates
not only this conscious departure from past practice but also the
Congressional Intent to limit the Federal share of revenues from leasing.

We find S.735's alternation of the historic compromise especially
troubling because in the case of one western state, Alaska, where the revenue
sharing provisions are part of the Statehood compact between the State and the
Federal Government. It should be noted that Alaska does not share in the
Recleunation Fund, but instead receives 90 percent of the revenue directly. We
believe that unilateral changes to agreements between the Federal government
and the people of a state are unconstitutional and that such a precedent could
lead to Congressional alteration of other fundamental provisions of our
compacts with the Federal Government.

Finally, insufficient revenue does not appear to be a barrier to full
implementation of the LWCF. The revenue sources which currently finance the
fund significantly exceed the $900 million ceiling in current law. Further
the Federal Government has spent far less than the authorized amount over the
last decade. For example, the government's actual expenditures over the five
year period from 1981 to 1985 averaged only $359 million.

To conclude, we oppose alternation of revenue sharing formulas which were
intended to compensate states for Federal retention of public lands within our
states. Further, we do not believe that the proposal is necessary to achieve
the worthy goals of the LWCF.

This letter is being sent out on behalf of Governors Steve Cowper (AK),
Evan Mecham (AZ), George Deukmejian (CA), Roy Romer (CO), John Walhee (HI),
Cecil Andrus (ID), Ted Schwlnden (MT), Richard Bryan (NV), Garrey Carruthers
(NM), George Sinner (ND), Neil Goldschmidt (OR), George Mickelson (SD), Booth
Gardner (WA), Michael Sullivan (WY), and myself.

Thank you for considering our views on this matter.

Sincerely,

(^^'T-t'UiUt /V^

Norman H. Bangerter*

Governor

Chairman Western Governors' Association

NHB:ras

121

Working for the Nature of Tomorrow^

MM^ NATIONAL WILDLIFE FEDERATION

1412 Sixteenth Street, N.W., Washington, DC. 20036-2266 (202) 797-6800

July 28, 1987

The Honorable J. Bennett Johnston . ' ■

Chairman, Committee on Energy and v^^

Natural Resources
136 Hart Senate Office Building
Washington, DC 20510

Re: Comments of the National Wildlife Federation on S. 735, a
Bill to Amend the Land and Water Conservation Fund and for
Other Purposes

Dear Mr . Chairman :

The National Wildlife Federation (NWF) would like to provide
you with comments on S. 735. We are submitting these comments for
inclusion in the record for the hearing your committee held on
July 14, 1987, in regard to this bill.

The NWF is the Nation's largest not-for-profit, conservation-
education organization, with over 4.6 million members and
supporters throughout the United States and in 51 affiliated
state and territory organizations. We have supported the Land and
Water Conservation Fund (LWCF) since its beginning. This fund has
been a vital source of revenue for the acquisition of wetlands and
other lands which have enhanced federal fisheries and wildlife
management programs. In particular, the LWCF has been one of the
few weapons readily available to fight back against the rising
tide of wetland loss.

As you are aware, appropriations from the LWCF have been
variable over its lifetime, averaging about $596 million from 1976
to 1980, and $257 million from 1981 to 1986. Title III of
S. 735 calls for the establishment of a "Special Account" within
the Fund from which at least $160 million would be appropriated
automatically each year for federal land acquisition. Creation of
such an earmarked special account would lend stability to annual
appropriations from the LWCF. Therefore, the NWF supports the
concept of an automatic, earmarked appropriation from the LWCF,
which is embodied in S. 735.

However, there are several reasons why the NWF cannot support
this particular legislation. First, the NWF does not support the
bill's implicit tie to the proposal to extract oil from the Arctic
National Wildlife Refuge. The "Special Account" of Title III
would derive part of its income "...from the leasing of oil and
gas resources within units of the National Wildlife Refuge System

122

The Honorable J. Bennett Johnston
July 28, 1987
Page 2

pursuant to leases issued after the date of enactment of
this title ... ." Based on the large data gaps in the Department
of the Interior's 1002 Report, the NWF contends that more
information is needed before a decision on the proposal can be
reached. Thus, we consider proposals, such as those contained in
S. 735, for allocating revenues from oil extraction activities to
be premature.

Second, oil extraction revenues derived from National
Wildlife Refuges are unnecessary for improving the effectiveness
of the LWCF. As you know, much of the annual authorization for
the LWCF is not appropriated. Congress can change this situation
at any time by making larger appropriations available or by
establishing an automatic funding mechanism. The NWF would like
to see the LWCF gain true Trust Fund status with attendant
automatic annual appropriations for federal land acquisition.
Substantial, long-term benefits will accrue to the Nation from
establishment of such a Trust Fund. This can be achieved without
adding revenues derived from the Arctic National Wildlife Refuge,
or any other National Wildlife Refuge, for that matter.

Finally, should the day arrive when revenues are derived from
oil extraction on the Arctic National Wildlife Refuge, or other
National Wildlife Refuges, most, if not all, federal revenues
should be reinvested into management and expansion of the National
Wildlife Refuge System. There are many fisheries and wildlife
funding needs within the System, and revenues derived from the
System should not be diverted away from these needs .

The foregoing reflects our view of S. 735. Thank you for the
opportunity to provide these thoughts.

Sincerely,

Lyni|\ A. Greenwalt
VicAV resident
ResoKcces Conservation
Department

LAG : sm

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